Bitcoin nearly overtakes $74K, as data suggests bear market is not over

Bitcoin showed remarkable strength throughout the week, but BTC’s correlation to tech stocks and its reactive spot ETF flows suggest the bear market isn’t over yet.

Bitcoin sits above $71,000 as weak US economic data and the US and Israel-Iran war drive investors toward scarce assets.

Tech stocks’ correlation to BTC and rising oil prices suggest that the 5-month correction from $126,000 might not be over.

Bitcoin (BTC) jumped above $73,000 on Friday, successfully locking in the 70,000 support for the week. These gains occurred as the US reported weak economic activity data, triggering concerns of an impending recession while the war in Iran continues to drag on.

While socio-economic events and institutional inflows might have led to Bitcoin’s bullish momentum, traders are still questioning if the bear market has actually ended.

The US economy grew by a mere 0.7% between October and December 2025, which was a significant downgrade from previous estimates, according to a US Commerce Department report released on Friday. While the final report is due April 9, the risks of a recession throughout 2026 have increased, driving investors away from US Treasuries.

Yields on the US 10-year Treasury surged to 4.26%, meaning investors are demanding a higher return to hold those assets. The mere risk of additional liquidity causes traders to seek shelter in scarce assets. This partially explains why the S&P 500 traded just 5% below its all-time high despite the worsening economic conditions.

On Monday, the S&P 500 futures plummeted to their lowest levels in over three months after oil prices briefly surged to $119.50. The US decision to temporarily authorize the purchase of Russian oil stranded at sea helped to cool off some of the risks. This move, announced by US Treasury Secretary Scott Bessent on Friday, eased the markets’ short-term concerns.

Institutional demand for Bitcoin has also been signaled as a potential driver for the recent bullish momentum. Spot exchange-traded funds (ETFs) faced four consecutive days of net inflows totaling $583 million, while analysts estimate that Strategy (MSTR) accumulated over $900 million through the yield-bearing STRC instrument.

Related: Bitcoin's 'extremely precise' macro signal puts $100K target back in play

At first glance, the economic backdrop points toward liquidity injections and rising institutional interest in Bitcoin. However, that doesn't necessarily mean the five-month correction following the $126,000 peak in October 2025 has ended. 

Bitcoin’s 50-day correlation with the Nasdaq 100 sits at 84%. As concerns grow over sticky inflation and stagnant economic growth, the odds of a stock market pullback increase. Traders are unlikely to use Bitcoin as a hedge, especially given its recent underperformance compared to gold.

Adding to this, oil prices remain $30 higher than levels seen before the war in Iran began. These high fuel costs hit consumer spending and create inflationary pressure, which reduces the capital retail traders have available for crypto investments.

Inflows to the spot BTC ETFs have surged as $2.14 billion entered the ETFs from Feb. 24 to March 4, driving a 14% rally. However, prices slipped 10% over the next four days as those flows reversed. This suggests spot ETF activity is just reacting to Bitcoin’s price rather than acting as a leading indicator.

Whether Bitcoin stays above $70,000 over the weekend may not shift investor sentiment. While a five-week consolidation and several tests of the $64,000 support show bulls’ confidence, the recent price action hasn't delivered a clear signal for a breakout.

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Source: CoinTelegraph