Bitcoin bounces back: BTC is up to $70,000 after nearly breaking below $60,000

$2.5 billion in liquidations shake the market as "extreme fear" grips investors during the worst weekly slide since 2022.

Bitcoin, the world’s largest cryptocurrency, rallied back above $70,000 over the weekend after a period of intense volatility that saw the price plunge toward the $60,000 level earlier in the week. As of Sunday, February 8, the asset was consolidating around $70,500, leaving traders wondering if they just witnessed a "dead cat bounce" or the start of a massive trend reversal.

The "flash crash": What triggered the dip?

The week began with a brutal sell-off that wiped out gains dating back to late 2024. Several macro and technical factors converged to create a "perfect storm":

The tech contagion: A broader sell-off in U.S. technology stocks, specifically the "Magnificent Seven", spilled over into crypto as investors fled "risk-on" assets.

Liquidations galore: As Bitcoin broke key support levels, over $2.5 billion in leveraged long positions were "force-liquidated" in a single 24-hour window, accelerating the downward spiral.

The $60,017 Floor

Bitcoin bottomed out at approximately $60,017, its lowest level in 16 months, before a wave of "buy the dip" orders from institutional whales and spot buyers sparked the rebound.

Despite the $10,000 price recovery, the psychological scars remain visible. The Crypto Fear & Greed Index plunged to a staggering 5/100 (Extreme Fear) on Saturday, the lowest reading in over three years.

While retail sentiment is currently "bleak," contrarian analysts note that historical price bottoms often coincide with these exact levels of panic. However, the options market suggests caution; data shows a heavy build-up of "put" options (bets that the price will fall) targeting the $50,000 to $55,000 range for the end of February.

The Saylor Factor: Strategy's $12B hit

The crash had a massive impact on the corporate world's largest Bitcoin holder, Strategy (led by Michael Saylor).

The company reported a staggering $12.4 billion net loss for the fourth quarter, primarily driven by "mark-to-market" declines in its Bitcoin treasury.

On Friday, as Bitcoin bounced, Strategy’s stock mirrored the move, soaring 26% in a single session to lead the Nasdaq’s recovery. Other crypto-linked firms, such as Coinbase (+13%) and MARA Holdings (+22%), followed suit.

What to watch this week

Investors are now looking toward the February 27 options expiry as the next major volatility catalyst. If Bitcoin can hold the $68,000–$70,000 support zone through the weekend, it may signal that the worst of the "post-election" correction is over. If not, the "Fear Index" suggests a revisit to the $60,000 floor is highly probable.