Bitcoin rebounded over the weekend as easing liquidation pressure and improving market sentiment helped the leading cryptocurrency recover part of last week's losses.
The digital asset rose 3.01 per cent in 24 hours to trade at $76,800.38 on Sunday, closely mirroring a 3.03 per cent increase in the overall cryptocurrency market capitalisation.
The recovery followed a week of sustained selling pressure across the digital asset market, driven by heavy outflows from Spot Bitcoin Exchange-Traded Funds (ETFs) and lingering geopolitical concerns.
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Market data showed Bitcoin trading volume declined by about nine per cent to $28 billion, while its market capitalisation stood at approximately $1.54 trillion.
Analysts said the near-identical movement between Bitcoin and the broader crypto market suggested the latest rebound was driven more by improving general market sentiment than by any Bitcoin-specific catalyst.
The rally comes after six consecutive days of Spot Bitcoin ETF outflows, which reportedly totalled about $1.26 billion last week.
However, derivatives market data indicated that forced selling pressure may be easing.
Bitcoin liquidations dropped sharply by 67.13 per cent to $124.33 million within 24 hours, reflecting a significant reduction in leveraged positions being wiped out during market volatility.
Technical analysts noted that the cryptocurrency found support near the Fibonacci 38.2 per cent retracement level at $76,130 and remained above its 30-day moving average of $75,850.
According to market watchers, the previous sell-off helped flush out excessive leverage, creating room for a short-term recovery.
They added that maintaining price action above the $76,130 support level could provide a stronger technical base for further upward movement.
Analysts also pointed to the importance of Bitcoin sustaining gains above the seven-day simple moving average of $76,742 to confirm renewed bullish momentum in the short term.
Attention is now shifting to whether Bitcoin can reclaim the recent swing high of $77,288, which traders view as a key resistance level for the next leg of the rally.
Investors are also closely monitoring upcoming Spot Bitcoin ETF flow data expected this week, as a return to positive inflows could strengthen market confidence and support further gains.
Market participants, however, warned that continued ETF outflows may limit upside momentum despite the latest recovery.
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