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Bull-Bear Showdown Imminent: Bitcoin Fluctuates Around $67,000, PCE Inflation Data Could Be the Key to Breakthrough

Friday, February 20, 2026

In the past 24 hours, the cryptocurrency market has once again staged a thrilling tug-of-war between bulls and bears. Bitcoin repeatedly battled around the $67,000 mark, briefly plunging to $65,700 during the session before quickly recovering some of the losses. As the U.S. January core PCE inflation data approaches, market sentiment has become extremely sensitive—are investors looking to bottom fish or continue to wait and see? The answer may soon be revealed.

Market Recap: Bottoming Out and Rebound, Narrow Fluctuations

Today during the Asian trading session, Bitcoin mainly traded within a narrow range around $67,000, with light trading volume and most investors holding their positions and observing. Market focus was entirely on the evening U.S. stock market open and macroeconomic data guidance. However, during the U.S. trading hours, the situation changed dramatically. The collective weakness in tech stocks and a strong rally in the dollar index caused a sharp decline in risk appetite. Bitcoin repeatedly broke below the key psychological levels of $67,000 and $66,000, with a low of $65,700, hitting a daily low. In the late session, some bottom-fishing funds entered the market, leading to an oversold rebound, and the price ultimately recovered to the $66,500–$67,000 range, narrowing the day's volatility.

Three Core Factors Driving the Market

1. Rising Expectations of Tightening Macro Liquidity

The dollar index surged past the 98 level during the session, hitting a four-week high. This movement reflects a market expectation that the Federal Reserve’s rate cuts in the short term are diminishing. Ahead of the upcoming release of the U.S. January core PCE inflation data, funds generally shifted to safe assets, withdrawing from high-risk assets like cryptocurrencies. If inflation data exceeds expectations, the Fed’s hawkish stance will be further reinforced, putting pressure on the crypto market; if the data is moderate, it could provide a brief respite.

2. Increased Correlation with U.S. Tech Stocks

Currently, Bitcoin’s correlation with the U.S. tech sector (especially software stocks) has reached a historically high level. Last night, a broad decline in tech stocks triggered sector-wide sell-offs, and this negative sentiment quickly spread to the crypto market, becoming a direct catalyst for price declines. Increasingly, the market views Bitcoin as a risk asset, with its movements highly correlated with indices like the Nasdaq and growth stocks such as ARKK.

3. Persistent Market Sentiment and Leverage Liquidation Amplify Volatility

Crypto market fear and greed indices have fallen to their lowest levels this year, indicating investor sentiment is in extreme fear. With weak bullish momentum and the continued liquidation of high-leverage long positions, a negative feedback loop has formed—“decline → liquidation → further decline”—amplifying intraday volatility. Currently, the market exhibits a clear pattern of capital redistribution, with limited willingness from new funds to enter.

Market Outlook: PCE Data as a Watershed

In the short term, Bitcoin remains in a sideways and weak pattern, with the core driver being the upcoming U.S. January core PCE inflation data. The market generally expects this data to stay high; any unexpected upside could reinforce the Fed’s tightening expectations, likely causing Bitcoin to lose the critical $65,000 support and open further downside space.

Conversely, if the data meets or falls below expectations, market liquidity expectations could temporarily improve, and Bitcoin may see a technical rebound. Attention should be paid to whether the resistance zone of $67,000–$68,000 can be broken. Only a confirmed breakout above this range can reverse the current weakness.

For investors, the current market uncertainty is high, and the risk of buying the dip on the left side is considerable. It may be better to wait until the data is released and the direction becomes clearer before making decisions. After all, macro events often render technical levels fragile.

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Disclaimer: This analysis is based on publicly available information and is for reference only. It does not constitute investment advice. Cryptocurrency markets are highly volatile; please invest cautiously and bear your own risks. $BTC ‌$ETH ‌