Bitcoin Sentiment Hits Record Low as Analysts Debate Whether $60K Marked the Bottom

Bitcoin (BTC) rebounded above $71,000 on Monday after crypto market sentiment plunged to historic lows, sparking debate among analysts over whether the recent drop toward $60,000 marked a cycle bottom. While extreme fear readings and liquidation data hint at a potential recovery, weak market structure and derivatives pressure continue to pose downside risks.

Crypto Fear & Greed Index Hits All-Time Low

Market sentiment across the crypto sector recently reached one of its most bearish extremes on record. The Crypto Fear & Greed Index dropped to a historic low near 7, signaling “extreme fear” among investors.

Historically, such sentiment levels have often appeared near major Bitcoin market bottoms. Analysts noted that similar readings were last seen during:

The 2018 bear market

The March 2020 COVID-19 crash

Some market participants believe these conditions could signal that Bitcoin is nearing a price floor, with $60,000 emerging as a key support level.

Liquidation Data Suggests Potential Short Squeeze

Derivatives market data is adding to the bullish case for a short-term rebound. According to liquidation heatmaps, there is a significant imbalance between potential short and long liquidations.

Over $5.4 billion in short liquidations could be triggered if BTC rises roughly $10,000

Around $2.4 billion in liquidations sit below current levels near $60K

This disparity suggests that an upward move could force short sellers to close positions, potentially fueling a short squeeze and accelerating Bitcoin’s recovery.

Such dynamics often lead to sharp upside volatility when market sentiment is heavily bearish.

Technical Structure Still Signals Weakness

Despite improving sentiment indicators, Bitcoin’s broader technical structure remains fragile. On-chain and technical data show BTC trading well below key moving averages:

50-day moving average near $87,000

200-day moving average near $102,000

This wide gap indicates a corrective phase following the previous rally, with analysts describing current price action as a repricing period rather than a confirmed bottom.

Additional metrics reinforce caution:

Negative price Z-score suggests BTC is trading below its statistical average

Derivatives markets show rising selling pressure

Futures activity continues to outweigh spot demand

Until stronger spot buying returns, Bitcoin may struggle to sustain a recovery.

Could Bitcoin Drop Below $60K Again?

While some analysts see $60,000 as a potential bottom, others warn that historical patterns leave room for deeper corrections.

In previous cycles, Bitcoin bear market lows often formed below the 0.618 Fibonacci retracement level. For the current cycle, that level sits around $57,000, with more extreme downside scenarios extending lower if macro conditions worsen.

At the same time, oversold indicators such as a deeply depressed RSI suggest BTC could consolidate or rebound before any further decline.

Outlook for Bitcoin Price and Market Sentiment

Bitcoin’s recent bounce above $70,000 highlights how quickly sentiment can shift in crypto markets. Extreme fear readings, combined with large short-liquidation zones, may support a short-term recovery.

However, broader market conditions — including macro uncertainty, derivatives-driven selling and weak spot demand — mean volatility is likely to remain high.

Key Levels to Watch

Support: $60,000 – $57,000

Resistance: $70,000 – $75,000

Major resistance: $87,000 (50-day MA)

Conclusion

Bitcoin’s record-low sentiment has sparked renewed debate about whether the recent sell-off marked a long-term bottom. While contrarian indicators and liquidation data point to potential upside, structural weakness and macro pressure suggest caution is still warranted.

As always in crypto markets, sentiment can reverse quickly — making the coming weeks critical for determining whether $60K becomes a confirmed Bitcoin bottom or just another stop in a broader correction.