Bitcoin Rebound: 3 Bullish Signals After $100K Plunge

The cryptocurrency market’s recent correction saw Bitcoin’s valuation tumble by nearly 10% in the past week, culminating in a temporary plunge to around $99,000 on November 4. This bearish performance triggered widespread panic across the crypto space, pushing the popular Fear and Greed Index into ‘Extreme Fear’ territory. While this might appear as another layer of bad news, historical analysis suggests it could actually signal an impending turnaround.

As highlighted by X user ALLINCYPTO, previous occasions in recent years when the Fear and Greed Index dropped to similar lows were consistently followed by Bitcoin price rebounds. This pattern aligns with the crypto market’s tendency to move against mainstream expectations, where extreme fear levels often indicate that the bottom has been reached and present potential buying opportunities. The current sentiment reading, rather than signaling continued decline, may be setting the stage for the next upward movement.

Another compelling bullish factor comes from CryptoQuant’s data showing Bitcoin reserves on cryptocurrency exchanges continuing to hover around the seven-year low of approximately 2.38 million BTC reached on November 3. This metric is particularly significant because it reflects reduced selling pressure rather than a shift toward centralized platforms that would indicate widespread profit-taking intentions.

The persistently low exchange reserves suggest that long-term holders are maintaining their positions despite recent price volatility. When Bitcoin moves off exchanges into private wallets, it typically signals investor confidence in holding rather than selling, creating a supply squeeze that can fuel price appreciation when demand increases. This fundamental supply dynamic provides a strong foundation for potential price recovery.

Bitcoin’s Relative Strength Index (RSI), which measures the speed and magnitude of recent price changes to help identify reversal points, currently stands at approximately 32 according to CryptoWaves data. The technical analysis tool ranges from 0 to 100, with readings around or under 30 suggesting an asset is oversold and poised for a rally. The current RSI level indicates Bitcoin is approaching this traditionally bullish territory.

Adding to the technical optimism, Coin Bureau analysts note that Bitcoin’s price has touched its 50-week moving average, a level that has historically preceded new all-time highs. Currently trading at just under $103,000, numerous industry participants believe the rebound has just begun. The convergence of these technical factors creates a compelling case for renewed bullish momentum in the near term.

Beyond technical and on-chain metrics, some market observers point to external factors that could catalyze Bitcoin’s recovery. The prolonged shutdown of the United States government has been identified as a potential negative influence on BTC and the entire cryptocurrency sector. However, the eventual resolution of this political standoff could serve as a major positive catalyst.

X user Gordon recalled that a similar government shutdown occurred in early 2019, and once operations resumed, Bitcoin’s valuation exploded. This historical pattern suggests that the current political uncertainty might be creating temporary headwinds rather than fundamental damage to Bitcoin’s long-term prospects. As these external pressures resolve, they could unlock significant upward price potential for the world’s leading cryptocurrency.