Is Now the Time to Buy Bitcoin? Four Positive Signals

# Bitcoin Indicators Suggest Imminent Rebound: Cryptopolitan Crypto news outlet Cryptopolitan reported on the 11th of this month that several Bitcoin indicators suggest the cryptocurrency may be nearing a rebound, following a recent period of downward adjustment. ## Recent Decline Differs from 2021 Bear Market Some analysts argue that Bitcoin has entered a bear market, but the current decline is said to be different from the 2021 downturn. Back in 2021, Bitcoin plummeted 41% from $69,000 to $40,560 over a span of 60 days. If a similar dip were to occur now, Bitcoin would need to fall to $64,400 by the end of March. Currently, Bitcoin’s decline percentage is similar to the 31.5% drop seen in June of last year. Then, Bitcoin slid from $71,940 to $49,220 over 60 days. If the current correction follows past patterns, a larger drop could potentially be avoided, signaling the end of the adjustment period. ## Weakening U.S. Dollar, a Positive Signal for Bitcoin The weakening U.S. dollar is a positive indicator for Bitcoin. Historically, Bitcoin tends to move inversely to the dollar. During Bitcoin's 2021 bear market, the Dollar Index (DXY) rose from 92.4 to 96.0. However, the DXY, which was at 109.2 earlier this year, has now fallen to 104. This decrease suggests that investors aren't flocking to the dollar, indicating market stability. If the market remains stable, Bitcoin's short-term rebound potential increases. ## Derivatives Market Indicates Bitcoin Rebound Possibility The Bitcoin derivatives market remains robust. The current annual premium for Bitcoin futures is 4.5%, a healthy level compared to past bear markets. For example, when Bitcoin fell 44% from $31,350 to $17,585 in June 2022, the futures premium dropped to 0%. The absence of similar fear in the current market raises expectations for a possible rebound. The funding rate in Bitcoin perpetual futures is also close to 0%, indicating a balance between buyers and sellers. In typical bear markets, short positions dominate, turning the funding rate negative. Presently, this isn't the case. ## Economic Uncertainty and Real Estate Crisis May Boost Bitcoin Concerns over a potential U.S. government shutdown on March 15 have unsettled the market. If a shutdown is avoided, investor sentiment could recover, potentially boosting risk assets like Bitcoin. Additionally, the crisis in the U.S. real estate market is noteworthy. January home sales hit a record low, and mortgage delinquency rates have exceeded levels seen during the 2008 financial crisis. Such financial instability may drive investors towards safe-haven assets, with Bitcoin emerging as a viable alternative. ## Bitcoin's Recovery Potential The combination of a weakening dollar, a strong derivatives market, and economic uncertainty could collectively enable Bitcoin to recover soon. Experts are particularly focused on Bitcoin's potential to reclaim the $90,000 level.