Bitcoin breaks through $41,000, analysts say "downward trend may reverse"

The situation between Russia and Ukraine continues to deteriorate. Russian President Vladimir Putin placed the nuclear deterrent on high alert on Sunday, while other countries stepped up their financial sanctions. Affected by geopolitical uncertainty, Bitcoin fell to a low of $37,000 over the weekend, but began to rebound on Monday. In the minutes before the opening of the U.S. stock market, Bitcoin jumped from $38,000 to $39,500 and returned to the key psychological level of $40,000. According to Bitpush terminal data, Bitcoin once broke through $41,000 in the past 24 hours, and the increase fell back to above $40,900 as of press time, with a 24-hour increase of 4.66%.

“Right now, the market appears to be responding positively to moves to isolate and weaken the Russian economy,” Lennard Neo, an analyst at Stack Funds, told CoinDesk.

Independent market analyst Johal Miles tweeted that there is currently "huge buying pressure" in the market and the downward trend may be about to reverse.

Miles highlighted Bitcoin’s recent upward retracement, testing levels close to $34,000 as support. For example, on January 24 and February 24, BTC’s price formed a bullish Hammer Candlestick pattern on its daily chart, a pattern that often signals an extension of a trend or the end of a retracement phase.

The same bullish hammer pattern occurred in May and June last year, with its bottom located below the critical support level of $30,000. This was followed by a sharp price reversal in the Bitcoin market, rising to nearly $69,000 in November 2021.

Additionally, Miles noted that buying sentiment between $28,500 and $34,200 is relatively higher than around $46,000, which was the support that Bitcoin fell to the downside in January 2022. He said: "The main difference between the current range and the 46,000 range is that when the stage low is hit, we now see huge buying pressure, which to me is a spell that the downtrend will run out, just like it did last summer. I could be wrong, but this is my view."

Data analysis platform Glassnode said that most Bitcoin wallets have been actively accumulating Bitcoin, among which smaller wallets are the most aggressive group in purchasing BTC.