Bitcoin has surged back to $70,000! With ETF funds flowing back into the market and a short squeeze triggering liquidation of bearish positions, is a breakout rally imminent?

Bitcoin prices have rebounded strongly amid multiple positive catalysts, regaining the psychological threshold of $70,000. During Monday’s Asian session, the price briefly surged to $71,852, a significant rebound from the lows of around $60,000 the previous week. As of press time, Bitcoin is trading at $70,847, with market sentiment clearly recovering.

Earlier, Bitcoin continued to weaken due to macroeconomic and geopolitical shocks, including hawkish expectations triggered by Kevin Warsh’s nomination as Federal Reserve Chair and risk-averse capital flows caused by the US fiscal deadlock, which led to a temporary price dip. The Fear and Greed Index fell to 6, indicating extreme panic among investors.

One of the direct drivers of this rebound is the return of ETF capital inflows. Data shows that on February 6, the spot Bitcoin ETF recorded approximately $371 million in net inflows, ending a three-day streak of over $1.2 billion in outflows. Institutional money re-entering the market is seen as an important signal of short-term sentiment recovery. Meanwhile, Japanese Prime Minister Sanae Takaichi won the general election and announced a large-scale fiscal stimulus plan, boosting global risk assets and providing an external environment conducive to Bitcoin’s rebound.

On-chain data also indicates rapid short squeeze activity. In the past 24 hours, nearly $180 million in short positions were forcibly liquidated, nearly six times the amount of long positions. The passive buying caused by short covering further amplified the upward momentum.

From a technical perspective, Bitcoin has returned above $70,000. The MACD has shown an initial bullish crossover, but the Aroon indicator still indicates that downward pressure has not fully dissipated. If the price can stabilize and push above the $74,500 region, it could open up further upside potential; if momentum remains insufficient, a retest of key support levels cannot be ruled out.

In the short term, ETF capital flows, macroeconomic policy changes, and derivatives clearing activity will continue to be the core variables influencing Bitcoin’s trajectory.