Bitcoin Sentiment Index Has Recovered Above 55.3% – The Start Of A Bullish Rally?

Bitcoin has faced massive volatility and sharp price swings as the market remains uncertain about the coming weeks. After briefly losing key levels at $90,000 and $85,000, BTC saw a strong reaction from bulls, surging back to $95,000 following President Trump’s announcement of a U.S. Strategic Crypto Reserve. This rally temporarily boosted sentiment, but Bitcoin has since retraced and now hovers around the $90,000 mark, struggling to define a clear direction.

At this stage, BTC is at a critical point, with traders closely watching whether it will reclaim higher levels or face renewed selling pressure. CryptoQuant data reveals that the sentiment index has recovered above 55.3%, suggesting that market confidence is improving and a recovery could be on the horizon. A sustained move above $90K would reinforce bullish momentum, potentially setting the stage for another push toward all-time highs.

However, uncertainty remains, and a failure to hold current levels could signal further downside risk. With sentiment showing signs of recovery, Bitcoin’s next move will be crucial in determining whether the market is ready to shift into a new bullish phase or if further consolidation is needed before a decisive breakout.

Bitcoin Sentiment Resets – What’s Next?

Bitcoin’s recent price moves and volatility have triggered a rollercoaster of sentiment shifts, going from extremely bearish to extremely bullish and back to bearish—all in less than a week. This type of rapid sentiment change is typical during periods of market uncertainty, as clear trends usually align with sustained sentiment shifts. With Bitcoin struggling to establish a firm direction, traders remain on edge, watching for the next decisive move.

Top analyst Axel Adler shared insights on X, revealing that the sentiment index has recovered above 55.3%, signaling a potential shift in market confidence. This strengthening bullish sentiment could provide the necessary momentum for Bitcoin to start a rally into higher levels.

BTC has struggled to retest its all-time high (ATH) since late January, with every attempt facing strong resistance and market hesitancy. If sentiment continues to improve, Bitcoin may finally gain the strength needed to break through key resistance zones.

However, the market remains at a crucial turning point. The next few trading sessions will be key in determining whether BTC can confirm a bullish trend or if it will face another retrace. If Bitcoin can hold above critical support levels and reclaim $95,000, the probability of a sustained rally increases. But failure to maintain current momentum could lead to another wave of selling pressure, extending Bitcoin’s consolidation phase and delaying its next breakout attempt.

BTC Holding Above $90K

Bitcoin is currently trading at $90,700 after finally reclaiming the $90,000 level, a crucial psychological and technical price point. However, there is still no confirmation that this level will hold, as volatility remains high, and prices could drop again before the end of the week.

For bulls to maintain control, Bitcoin must stay above $90K and build momentum toward reclaiming $95,000. If BTC successfully clears this level, it could set the stage for a push beyond $100,000, marking a significant breakout and renewing bullish sentiment across the market.

On the downside, losing the $85,000 level could trigger massive selling pressure, potentially sending BTC into lower demand zones and extending its period of uncertainty. This would weaken bullish momentum and raise concerns about another deeper correction.

With Bitcoin hovering near critical price levels, traders are watching closely for signs of either a confirmed breakout or another pullback. If bulls can sustain current gains and push higher, the market could see a renewed bullish cycle. However, if BTC struggles to hold support, another period of downside pressure may be ahead, delaying any significant recovery.

Featured image from Dall-E, chart from TradingView