Is the Bitcoin rebound a trend reversal or a "dead cat bounce"? The current market structure is eerily similar to May 2022.

Bitcoin experienced a sharp decline from February 5 to 6, with the price dropping from over $75,000 in early February to the $60,000–$61,000 range, roughly a 50% retracement from the high.

Subsequently, the market began a strong rebound on February 6, with daily gains of 10–17%, regaining the $70,000–$71,000 zone. As of February 10, Bitcoin’s price on Gate was $69,227.1.

However, the sustainability of this rebound has sparked widespread market discussion. Many analysts point out that the current market structure bears a striking resemblance to the period just before the Terra/LUNA collapse in May 2022.

Market Review: Recent Volatility and Historical Context

Recently, Bitcoin has experienced rollercoaster-like fluctuations. On February 6, Bitcoin’s price fell below $60,000 for the first time since November 2024, dropping to as low as $59,800.

This decline marked a roughly 48% drop from the all-time high of $126,080 set in October 2025. This drop was not an isolated event but the result of multiple factors converging.

Market analysis suggests that this decline was driven by several overlapping factors: forced liquidation of leveraged positions, increased volatility in safe-haven assets like gold, a broad tech stock correction, and profit-taking after the perceived realization of benefits from “Trump’s pro-crypto policies.”

Structural Comparison: Current Market vs. May 2022

There are several key similarities between the current market and May 2022. Excessive leverage is a common feature in both.

In 2022, over-leveraged crypto ecosystems ultimately triggered a chain reaction following the Terra/LUNA collapse. Today’s market also shows high leverage, with Bitcoin long liquidations totaling $1.096 billion between February 5 and 6.

Market sentiment has shifted from extreme optimism to sudden panic in both periods. Before May 2022, the market widely believed “this time is different,” and similarly, the current market was filled with comparable emotions before the recent plunge.

Increased institutional participation is another similarity. In 2022, many institutions had already entered the crypto space, and now institutional involvement is even deeper, increasing market maturity but also amplifying volatility.

Key Indicators: Data Revealing Market Health

Using several key metrics, we can better understand the current market condition:

Bitcoin recent price fluctuation data

Data sourced from Gate as of February 10

Market sentiment indicators currently show a “negative” outlook. This is similar to the pre-collapse period in May 2022, when the market also shifted from excessive optimism to panic.

Exchange flow data indicates that small investors (holding less than 10 BTC) have been continuously selling Bitcoin for over a month, while “whales” (holders of over 1,000 BTC) have quietly increased their holdings. This divergence mirrors the capital flow patterns seen before the 2022 market crash.

Current Rebound Analysis: Sustainability Assessment

After Bitcoin rebounded above $70,000, market opinions diverge on its sustainability. Supporters argue that key technical levels at $68,000–$70,000 have been tested and remain solid.

Institutional inflows may serve as a support factor. Some analysts note that large buyers view the $60,000–$65,000 range as a strong support zone and are accumulating Bitcoin within this price band.

Improved market structure could also be a positive sign. Compared to 2022, today’s crypto infrastructure is more robust, regulatory clarity has increased, and institutional participation is deeper.

However, concerns about the rebound’s sustainability persist. Macro environment uncertainties are a major risk. Federal Reserve policies, a strengthening dollar, stock market trends, and other macro factors could influence Bitcoin’s further price movement.

Leverage liquidation risk has not been fully eliminated. Although large-scale liquidations have occurred, market leverage remains high, potentially leading to further deleveraging pressures.

Risk Factors: Market Dynamics That Could Undermine the Rebound

Several key risk factors threaten the current Bitcoin rebound. Macroeconomic pressures could test the $60,000–$65,000 support zone again. In particular, changes in Federal Reserve monetary policy could significantly impact the crypto market.

Geopolitical tensions are also a concern. Recent escalations in US-Iran tensions have affected markets, and further escalation could trigger broader risk asset sell-offs.

Regulatory uncertainty remains a potential risk. Although the regulatory environment is clearer than in 2022, policy changes could still have a major impact.

Another risk to watch is the behavior of large holders. For example, MicroStrategy, led by Michael Saylor, holds a significant amount of Bitcoin. If such major holders decide to sell part of their holdings, it could exert downward pressure on the market.

Investment Strategies: Finding Opportunities in Similar Markets

In light of the market structure resembling May 2022, investors might consider the following strategies:

Aggressive investors could buy near the $70,000–$68,000 support zone, with stop-loss orders slightly below $68,000 to manage risk. Short-term upside targets could be set at $72,000–$75,000.

Trend followers might wait for confirmation of a breakout above $72,000–$73,000 with volume confirmation before entering, aiming for $75,000–$78,000, while using trailing stops to lock in profits.

Conservative investors may prefer dollar-cost averaging (DCA) to accumulate near lows, avoiding leverage and prioritizing risk management.

Regardless of strategy, risk management remains crucial. Avoid chasing highs and lows, especially given the high volatility still present in the market.

Summary

Bitcoin has rebounded to $69,227.1 on Gate, with active trading volume. Observers note that “whale” addresses are quietly increasing holdings, while retail investors continue to sell, creating a divergence reminiscent of the structural shifts before the 2022 crash.

Crypto market history rarely repeats exactly, but it often rhymes. When support levels on the charts align eerily with those from four years ago, and chain reactions of leverage liquidations unfold in similar patterns, collective market memory is awakened. Whether the rebound can sustain depends not only on technical signals but also on whether the market has learned enough from past cycles.