Bitcoin Faces Key Week Ahead with Major Price Movements, Strategic Crypto Reserve, and Market Sentiment Shifts

Bitcoin (BTC) has made a strong comeback, seeing a significant rebound after President Donald Trump's announcement regarding the creation of a U.S. Strategic Crypto Reserve. The recent surge, which included a $10,000 daily candle, has reignited optimism among traders, but concerns about potential retests of key price support areas remain.

Bitcoin’s Price Surge and the CME Gap

Bitcoin’s price action has caught the attention of traders worldwide. After a period of stagnation, BTC has climbed back with impressive momentum, surpassing $90,000 and sparking discussions about market structure, especially in relation to the CME futures gap.

The CME futures market saw an opening gap at $78,000, which Bitcoin recently filled. However, with the massive price surge, Bitcoin created a new gap — the largest in its history — reaching the $85,000 mark. This gap may serve as a short-term downside magnet for traders, as the market remains highly volatile, and the question arises whether the $85,000 level will be retested.

Traders are closely watching the $90,000 to $91,000 range, which has acted as a support level in recent months. Analyst Daan Crypto Trades highlighted that this zone is crucial for bulls, as it has previously served as the range low. “We saw a violent breakdown and retake back into the range,” he noted. “Price is currently testing it, and this would be a region where bulls would want to step in.”

Trump’s Strategic Crypto Reserve and Market Reactions

One of the most significant factors driving Bitcoin’s recent price surge is U.S. President Donald Trump’s confirmation of the Strategic Crypto Reserve. Over the weekend, Trump posted on social media confirming the reserve, which will include Bitcoin, Solana (SOL), XRP, and Cardano (ADA). The announcement has sparked excitement in the market, particularly given that Trump also mentioned his support for Bitcoin and Ether.

The strategic reserve announcement marks a pivotal shift in U.S. policy, signaling government endorsement of digital assets as part of a broader strategy to position the U.S. as the "crypto capital of the world." In response, Bitcoin's price surged, jumping nearly 20% at one point, and breaking through the $90,000 level.

The upcoming U.S. crypto summit, set to take place on March 7, has the potential to further fuel this momentum. The event is expected to bring clarity on the strategic reserve and other crypto-related policies, which could lead to more favorable regulations for digital assets.

Fed Chair Jerome Powell and Macroeconomic Events

In addition to the crypto-specific catalysts, this week’s macroeconomic data also holds significant relevance for Bitcoin's price trajectory. Key U.S. employment data is set to be released, with initial jobless claims on March 6 and the U.S. jobs report the following day. These numbers could have a profound impact on market sentiment, particularly in light of the Federal Reserve’s stance on inflation and interest rates.

Fed Chair Jerome Powell is scheduled to speak on the same day as the crypto summit, and his comments could further influence the market. The focus will likely be on the Fed’s next moves regarding interest rates, with markets paying close attention to inflation data and employment figures. As of now, the market does not expect a rate cut in the immediate future, which could add a layer of uncertainty to the broader financial landscape.

Crypto Market Indicators Showing Signs of Recovery

On-chain data shows that Bitcoin is beginning to recover on several fronts. The Coinbase Premium Index, which tracks the price difference between BTC/USD on Coinbase and BTC/USDT on Binance, has been rebounding toward positive territory. A positive premium is typically associated with increased demand from U.S. buyers, indicating renewed interest in Bitcoin.

Similarly, the Adjusted Spent Output Profit Ratio (aSOPR) indicator, which measures the profitability of coins being moved on the blockchain, has also returned to positive territory. This suggests that many Bitcoin holders are now in profit, following a period of significant losses during the previous market downturn.

These indicators suggest that selling pressure has eased, and with key resistance levels like $90,000 and $92,500 in sight, Bitcoin could be on the verge of further price gains.

Market Sentiment Remains Cautious

Despite the positive price action and news from the White House, overall market sentiment remains cautious. The Crypto Fear & Greed Index, which gauges the mood of market participants, still sits firmly in "fear" territory, though it has recovered from extreme lows. As of March 3, the index stands at 33/100, signaling a sense of uncertainty among traders.

Some analysts, like Julien Bittel, see the potential for a significant bull run if the current positive developments continue, while others remain skeptical. CryptoQuant contributor Crypto Avails pointed out that, while Trump’s announcement could spark a rally, his unpredictable nature leaves room for potential sentiment reversal. “His recent statements about a ‘crypto reserve’ could ignite a new rally,” said Crypto Avails.

“However, it’s also possible that he might later reverse the sentiment with comments like, ‘We’ve paid off all our debts, we no longer need crypto.’”

Conclusion: A Pivotal Week for Bitcoin

Bitcoin’s price has been on a strong rebound, fueled by the U.S. government’s confirmation of a Strategic Crypto Reserve and key macroeconomic data. While the announcement has injected significant optimism into the market, traders remain wary of potential retests of crucial support levels, including the CME gap at $85,000. The upcoming U.S. crypto summit, speeches from Jerome Powell, and new economic data could provide additional catalysts for price action.

Despite the positive developments, the market sentiment remains cautious, with many traders still in "fear" mode. The next few days will be crucial in determining whether Bitcoin can maintain its upward trajectory and potentially break through key resistance levels. Traders will be closely watching for any signs of further institutional interest and the long-term implications of the U.S. government’s stance on digital assets.