ETF Inflows Spark Crypto Bounce, Risks Remain

The cryptocurrency market experienced a sharp recovery this week, with Bitcoin climbing toward the $68,000 level and Ethereum pushing back above $2,000, as renewed inflows into spot Bitcoin exchange-traded funds (ETFs) and large-scale short liquidations lifted prices across the digital asset sector.

The rally was supported by roughly $257 million in net inflows into spot Bitcoin ETFs – the strongest daily intake since January – alongside more than $400 million in short liquidations that intensified upward price momentum. Gains were also recorded among major altcoins, including Solana, BNB and Cardano, signalling broader participation in the market’s rebound.

Analysts, however, warn that the recovery is now approaching key resistance zones, raising questions about whether the move can be sustained without stronger institutional demand.

ETF Demand Returns, But Flows Remain Mixed

Recent price gains come after a period of inconsistent ETF flows. Spot Bitcoin ETFs recorded a five-week run of outflows totalling $3.8 billion earlier this year before reversing course with modest inflows on February 20.

Market watchers say the uneven flow pattern suggests recent buying activity may be driven more by short-term positioning than long-term conviction, leaving the market vulnerable to renewed volatility.

Bitcoin’s market capitalisation is currently hovering near $1.28 trillion, while Ethereum’s stands at approximately $226 billion as of late February 2026.

Resistance Levels in Focus

Bitcoin is now fluctuating in the $69,000–$70,000 range, with analysts identifying resistance between $69,000 and $72,900 and a more significant ceiling near $75,000. A sustained break above these levels would likely be needed to confirm a stronger bullish trend. On the downside, $65,000 remains a critical support zone.

Ethereum faces resistance between $2,100 and $2,220, with immediate support located around $2,000. A deeper pullback could expose the $1,800–$2,000 range.

Macro Uncertainty Persists

The broader macroeconomic backdrop continues to present mixed signals. While improving risk sentiment has helped lift liquidity-sensitive assets such as cryptocurrencies, persistent inflation pressures are dampening expectations for rapid interest-rate cuts from the U.S. Federal Reserve.

A narrowing yield spread between U.S. and Japanese long-term government bonds may also indicate tightening global liquidity conditions, which could pose a potential headwind for risk assets.

Adding to near-term uncertainty is Friday’s scheduled $10.5 billion monthly Bitcoin options expiry, which could trigger heightened market volatility.

Altcoin Performance Diverges

While Bitcoin and Ethereum have led the recovery, altcoin performance has been uneven. Solana has outpaced both majors in recent weekly gains but continues to exhibit elevated volatility compared to Bitcoin and Ethereum.

BNB and Cardano have also recorded positive returns, though analysts caution that their longer-term performance remains tied to broader market trends and capital concentration in top-tier assets.

Price forecasts for the first quarter of 2026 remain widely divergent, with Bitcoin targets ranging from $60,000–$65,000 on the bearish end to as high as $150,000–$250,000 in more optimistic scenarios. For Ethereum, some analysts see potential downside toward the $1,800–$2,000 range.

Outlook

In the near term, the market’s trajectory will depend on whether it can hold above key support levels while breaking through overhead resistance. Sustained institutional inflows and a more stable macroeconomic environment are likely to be necessary for continued upside.

Until then, upcoming options expiries, inflation data and geopolitical developments could continue to influence investor sentiment in what remains a fragile recovery.