Bitcoin’s attempted comeback is losing steam.
On Tuesday, the world’s largest cryptocurrency stalled just below $78,500, struggling to build momentum after rebounding from a 10-month low. While the sharp selloff that briefly dragged prices toward the mid-$74,000s has eased, traders are far from convinced the danger has passed.
Across derivatives markets, caution—not confidence—continues to dominate.
A Fragile Bounce After a Brutal Slide
Bitcoin trading was largely flat through Tuesday, a day after bearish pressure nearly pushed the token to its weakest level since Donald Trump returned to the White House just over a year ago.
Prices dipped to $74,541 on Monday before buyers stepped in, lifting BTC back toward the upper-$78,000 range. Early Asian trading briefly carried Bitcoin above $79,100, but the rally quickly faded, underscoring how fragile sentiment remains.
For now, the market appears stuck in limbo—caught between relief buying and the fear of another leg lower.
Options Traders Circle $75,000 Support
Derivatives data shows that while extreme panic has cooled, anxiety hasn’t disappeared.
Put options—contracts that protect against downside risk—have eased from their peak, suggesting traders are no longer scrambling for immediate protection. Still, options positioning tells a cautious story.
According to Deribit data, the highest concentration of put options sits at $75,000, marking it as a crucial buy-side support level. A decisive break below that zone could quickly expose Bitcoin to its next major support near $70,000.
“The BTC options market is showing signs of stabilizing as extreme downside fear begins to mean-revert,” said Sean McNulty, APAC derivatives trading lead at FalconX.
“However, a weekly close below $75,000 would invalidate the current bounce higher, and potentially open a vacuum toward that $69,000 to $70,000 zone.”
In short: the bounce is real—but it’s on probation.
Perpetual Futures Flash Bearish Signals
The caution is even more visible in Bitcoin perpetual futures, which account for the majority of crypto trading volume.
Funding rates have turned negative, meaning short sellers now dominate the market and are paying long holders to keep their positions open. According to CryptoQuant, funding has dropped to its lowest level since August 2024, during the unwind of the yen carry trade.
Negative funding rates don’t guarantee further downside—but they do signal that traders are positioning defensively, betting against sustained upside in the near term.
Volatility Remains Elevated
Despite the calmer price action, volatility refuses to come down.
Bitcoin’s implied volatility index hovered around 48.8, roughly unchanged from Monday, according to TradingView. That level reflects continued uncertainty, with traders bracing for sharp moves in either direction.
“Turnaround Tuesday seems to be in effect,” said Jeff Anderson, head of Asia at STS Digital.
“Markets got over their skis selling risk assets, and now that everyone has calmed down a bit, things rally off the lows.”
But even that optimism comes with a caveat: rallies driven by short covering and relief buying can fade quickly if conviction doesn’t follow.
What Comes Next?
For Bitcoin, the map is becoming clearer:
Above $78,500–$79,000: Bulls can argue the worst is over—for now
Below $75,000 on a weekly close: The bounce likely fails
Below $70,000: A deeper reset could unfold rapidly
As traders watch options strikes, funding rates, and volatility gauges, one message stands out: the market isn’t panicking anymore—but it isn’t trusting the recovery either.
Bitcoin may have stepped back from the edge, but it’s still standing on a very narrow ledge.