Bitcoin BTC$64,902.62 reclaimed $65,400 early Wednesday as a weaker U.S. dollar and a risk-on tone across Asian equities gave crypto markets their first clean bounce in weeks.

The broader crypto market cap had slipped to $2.19 trillion earlier this week, practically retesting the lows hit during the Feb. 5 crash. That proximity is what makes the current move interesting.

If the level holds, the market is looking at a textbook "double bottom" with roughly 10% upside, according to Alex Kuptsikevich, chief market analyst at FxPro. If it doesn't, he warned, "a failure to rebound will signal the end of the recovery, opening the potential for a further 25% decline."

A double bottom is a classic bullish chart pattern that signals a potential trend reversal after a downtrend. Imagine the price dropping to a low, then bouncing up a bit, forming resistance and then falling back to test that same low point. This creates a W-shaped structure with two "bottoms." Once price breaks above the middle peak, a bullish reversal is confirmed.

The focus, therefore, is on whether the ongoing recovery rally extends beyond the brief bounce to $2.47 trillion market cap seen roughly 10 days ago.

Altcoins rise as dollar dips

In the meantime, major tokens are tracking bitcoin higher. Ether rose 4.2% over the past day, solana gained 7%, and XRP added 3%. The moves came as MSCI's gauge for Asian equities climbed 1.4% to a record, led by South Korea and Taiwan, where AI-linked chipmakers hit all-time highs ahead of Nvidia's earnings report later Wednesday.

The dollar provided a tailwind for risk assets. The Bloomberg Dollar Spot Index edged lower after President Trump's State of the Union address, in which he doubled down on tariff plans despite the Supreme Court striking down his global import taxes.

He further suggested tariffs could eventually replace the income tax system entirely.

A weaker dollar has historically been constructive for bitcoin, though the relationship has been inconsistent during this drawdown cycle.

But conviction remains thin despite the bounce notwithstanding. Bloomberg reported that analysts it surveyed described a "crisis of confidence" in bitcoin after its nearly 50% decline from all-time highs, with no obvious new catalysts for growth.

FxPro's Kuptsikevich went further, saying the market likely hasn't bottomed yet and that "real capitulation is still ahead."