Bitcoin has bounced back to $62,000 after experiencing a dip to seven-week lows at $58,500.
The recovery comes as the broader market also attempts to regain its footing.
Following a significant sell-off that led to a cascade of capitulations, Bitcoin’s price is showing signs of recovery.
Cointelegraph Markets Pro and TradingView data highlighted that BTC’s price strength began to recover after the Wall Street opening.
The relative strength index (RSI) for Bitcoin on four-hour timeframes had hit its lowest point since August 2023, indicating a highly oversold condition.
Daan Crypto Trades, a popular trader, confirmed the resilience of Bitcoin’s price range and noted that the previous day had seen the largest net selling in over a year, with RSI levels not seen in the same timeframe.
According to CoinGlass, total BTC long liquidations on June 24 amounted to nearly $150 million.
Despite this, Bitcoin faces ongoing challenges, including a strong U.S. dollar, which traditionally acts as a headwind for risk assets like cryptocurrencies.
Analyst Skew cautioned about the dollar’s strength, which might continue to impact the market in the short term.
Interestingly, applying Elliott Wave theory to the U.S. Dollar Index (DXY), Matthew Dixon, CEO of crypto rating platform Evai, pointed out a potentially bearish trend for the dollar.
He suggested that a further decline in the dollar could boost risk assets, including Bitcoin.
Moreover, market participants are also mindful of the psychological impact of the Mt. Gox bankruptcy proceedings, with concerns about how the release of 140,000 BTC might affect market prices.
Bitcoin’s bounce near its 200-day exponential moving average (EMA) at approximately $58,000 is seen as a critical support level.
The last time BTC traded below this trendline was in October.