BTC price has reached a new high for February as Bitcoin buyers aim for a distant target of $25,000, despite signs of growing support for a significant drop.

On February 5th, Bitcoin experienced a spike, surging past $43,500 as Wall Street opened. This move was a reaction to the turmoil in Chinese stock markets, which had a spooking effect on investors.

China’s stock losses have raised concerns about a potential recession. Data from Cointelegraph Markets Pro and TradingView indicated that Bitcoin reached local highs of $43,515 on Bitstamp, marking a new February record for BTC prices.

The Chinese CSI 1000 index had a single-day loss of 8%, leading Chinese authorities to implement further controls on short selling. Some observers, like The Kobeissi Letter, have raised questions about whether China might be on the verge of a recession, noting a “disconnect” between large and small-cap stocks.

A response on social media platform X (formerly Twitter) pointed out that China’s market had lost a staggering $7 trillion in value over the last three years.

Bitcoin’s volatility was also influenced by a notable increase in open interest, which reached $775 million. This information was shared by J. A. Maartunn, a contributor to the on-chain analytics platform CryptoQuant. Additionally, there were lower outflows from the Grayscale Bitcoin Trust (GBTC) compared to previous days, with around 2,600 BTC exiting the trust, continuing a positive trend.

Analyzing the composition of the order book, Keith Alan, co-founder of the trading tool Material Indicators, issued a new warning regarding BTC’s price. He pointed out that Bitcoin still lacked liquidity just below the current spot price, making a return to $42,000 relatively easy.

However, when looking at the broader picture, liquidity was increasing significantly lower, at around $25,000. This suggests a growing sentiment for a potential price dip. Alan clarified that this doesn’t necessarily mean an immediate drop to that level, but it does indicate the presence of sentiment for it.

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Moreover, Alan noted that the ask liquidity ladder above the spot price was also moving lower, implying that a swift move to $45,000 or higher in the short term was likely.