We have just experienced a horrible Bitcoin correction over the past two days as BTC fell 23% from the $ 58,000 to $ 44,800 zone. But then, Bitcoin has rebounded to over $ 50,000 in just 22 hours. The main driving force behind Bitcoin’s strong resistance is its low funding rate, the fact that Square buys more BTC, and an increase in market stability.

Across major exchanges, including Binance, BTCC, and Bitfinex, Bitcoin’s funding rate has dropped to 0.01%. The funding rate for Bitcoin futures was consistently above 0.1% throughout the entire resistance process from $ 40,000 to $50,000.

When the rate of futures is high, it means the market has too many buyers and the price push could be over-stretched. This creates a great risk of a prolonged squeeze, which could cause the price of Bitcoin to drop rapidly in the short term.

With a funding rate of 0.01% return, the long-term risk is significantly lower, and if a new uptrend occurs, the rally could be more sustainable.

On Feb. 24, Square invested an additional $ 170 million in Bitcoin – BTC sales via Cash App reached $ 4.57 billion. This payment giant did not hesitate to join hands with BTC in the recent storm.

As Bitcoin corrects, the price of BTC on spot exchanges like Coinbase is much lower than on futures exchanges. BTC price has rallied above $ 50,000, which could reduce the likelihood of retesting the downtrend even more.

In the near term, if Bitcoin continues to sustain above $ 50,600, transforming into support, the likelihood of a rise to the next resistance at $ 56,000 increases.

Such adjustments are quite normal for Bitcoin’s bull market cycle. In fact, this is very common in the 2017 bull market, with nine major pullbacks in the 20–40 percent range. But despite serious corrections going on, Bitcoin’s price is still 20 times higher than its previous all-time high in 2017.