BTC’s recent recovery may be hiding a dangerous signal. Bitcoin price rose nearly 9% between February 12 and February 15, giving the impression that the worst of the correction is over.
But the comeback is already faltering. Now, leverage data, momentum signals, and chain profit trends suggest that the bounce may have increased the risk of a crash instead of ending it.
Between February 12 and February 15, Bitcoin climbed about 9%. At the same time, futures traders positioned themselves aggressively for further growth. Total open interest, which tracks the total value of active futures contracts, rose from $19.59 billion to $21.47 billion. That was an increase of about $1.88 billion, or about 9.6 percent, between February 13 and 15.
This growth did not occur in isolation. Funding rates also turned strongly positive, rising to +0.34%. The funding rate is the fee paid between long and short traders. When it is positive, long traders pay short traders. This shows that most BTC traders were betting on the price going up.
BTCLeverage Increase: Sentiment
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Together, rising open interest and positive funding rates confirmed that the market was positioning itself for a larger recovery. But the larger structure of the graph reveals a critical problem.
The entire comeback took place inside a bearish flag pattern. A bear flag is formed when the price rises slowly after a sharp decline, but remains inside a descending continuation structure. It often acts as a pause before another decline.
BTC bounces inside a bear pattern: TradingView
The recent rejection near the local top and the ongoing pullback now show that Bitcoin is still trading in this bearish pattern. The price is already drifting towards the lower limit of the flag. If this lower support breaks, the next step of the Bitcoin price weakening prediction could begin.
Momentum indicators are now starting to confirm this growing weakness. On the 12-hour chart, Bitcoin formed a hidden bearish divergence between February 6 and 15.
During this period, the price formed a lower high, which means that the recovery was weaker than the previous peak. But the relative strength index, or RSI, formed a higher level. RSI measures the strength of buying and selling momentum.
Hidden RSI Divergence: TradingView
This combination is called a hidden bear divergence. It usually occurs when buying momentum temporarily increases, but the overall trend remains weak. It signals that sellers are quietly regaining control. Shortly after this signal appeared, the Bitcoin pullback began.
At the same time, data on the chain’s profit rose sharply, creating another warning sign. Bitcoin’s Net Unrealized Profit/Loss, or NUPL, increased from 0.11 on February 5th to 0.21 on February 14th. This was an increase of about 90%. It is currently moving near the same area as of press time.
NUPL measures the average unrealized profit across all Bitcoin holders. It shows how much profit investors hold on paper. When NUPL rises sharply, it means that many investors suddenly return to profit, even if it is a small amount. This increases the risk of taking profit.
Profit Growth: Glassnode
The last time NUPL reached similar levels was on February 4. At the time, Bitcoin was trading close to $73,000. In one day, the price crashed to about $62,800. This was a decrease of almost 14%. Now the same profit structure has appeared again.
This creates a scary situation. Investors holding fresh profits could sell quickly if prices start to fall. That sale may accelerate the correction. This lines up with the hidden bearish divergence already visible on the chart.
Together, these signals suggest that the recent pullback may have strengthened sellers rather than eliminating them.
Bitcoin is now approaching the most important support area in its current structure. The first critical level is $66,270. This level forms near the lower limit of the bear pattern breaks.
If Bitcoin falls below this Fib level, the bearish continuation pattern would activate. The next major downside target is at $58,880 ($58,000 area). This level aligns with the Fibonacci retracement level of 0.618 (a structurally strong area) and represents a decline of about 14% from current prices.
Bitcoin Price Analysis: TradingView
If the selling pressure accelerates further, Bitcoin could drop towards the $55,620 area, which aligns with the deeper projection of the bear flag structure. Additionally, Bitcoin needs to recover $70,840 to stabilize in the short term.
A stronger break above $79,290 would completely invalidate the bear structure. That would signal that buyers have regained control. Until then, risk remains tilted to the downside. The recent pullback briefly improved sentiment. But rising leverage, a hidden bearish divergence and a 90% increase in unrealized profits now show that Bitcoin’s price recovery may have created the conditions for another decline.
Read original story Bitcoin (BTC) price rally prompts 90% profit surge as lock-in risk at $58,000 by Ananda Banerjee at beincrypto.com
