Bitcoin breaks macro downtrend after surge toward $78,000

10:18

By: Dakir Madiha

Bitcoin breaks macro downtrend after surge toward $78,000

Bitcoin has moved above its long-standing macroeconomic downtrend after a decisive daily close on April 18, a shift that some analysts interpret as a potential end to a multi-month bearish cycle. The cryptocurrency climbed from around $74,000 to nearly $78,000 خلال a single session, driven largely by forced liquidations and shifting geopolitical signals that influenced market sentiment.

The rally was fueled primarily by a sharp short squeeze rather than fresh buying demand. Market data shows that roughly $357 million in short positions were liquidated within one hour at 21:00 UTC, accelerating upward price movement. Over a 24-hour period, total liquidations across the crypto market exceeded $826 million, with more than $660 million tied to short positions. This wave of forced closures amplified volatility and pushed prices higher in a compressed timeframe.

Technical analysts point to the daily close above a key descending trendline on the linear chart as a critical signal. Historically, such breakouts have marked transitions out of bearish phases. However, caution remains. On logarithmic charts, Bitcoin still trades near a resistance zone that must be cleared to confirm a structural reversal. Sustained daily closes near or above $80,000 are seen as necessary to validate a longer-term bullish trend.

Geopolitical developments added complexity to market dynamics. A temporary easing of tensions in the Middle East followed a ceasefire in Lebanon and the reopening of the Strait of Hormuz. This relief proved short-lived. Iran quickly reinstated restrictions and reportedly engaged vessels attempting to pass through the strait, declaring it closed until sanctions affecting its ports are lifted. These developments injected uncertainty into global markets and contributed to short-term volatility in risk assets, including cryptocurrencies.

Institutional flows provided a counterbalance. Spot Bitcoin exchange-traded funds recorded $663.9 million in inflows on April 17, bringing total cumulative net inflows to $58.15 billion. These steady inflows have supported price stability despite persistent macroeconomic pressure from elevated interest rates. Institutional participation remains a key pillar in sustaining upward momentum.

Market participants are now focused on near-term thresholds. Analysts identify $80,000 as a critical target, with bullish momentum intact as long as Bitcoin holds above $73,000. Some indicators, including a weekly bullish MACD crossover, suggest strengthening upward momentum. However, there are warnings that a deeper pullback could still occur in the second quarter before any sustained recovery takes hold. The next seven to ten days are expected to determine whether the breakout evolves into a durable trend or fades into another failed rally.