After a weekend where bitcoin (BTC) posted a $7.3 billion loss, the largest cryptocurrency has recouped all of its losses over the weekend and is up more than 8 percent to $21,206 in the last 24 hours.
Bitcoin is up almost 22 percent from Saturday’s low of $17,592 and is currently trading around $21,000.
The price of BTC rose more than 4 percent to $20,882, data from Coin Metrics showed on Tuesday. Bitcoin hit a low of $17,959 over the weekend. It has not been lower since December 2020.
Bitcoin surged on Wednesday after a slew of negative sentiment propelled the cryptocurrency to a new 2022 low over the weekend.
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Selling pressure in the bitcoin market
Due to massive liquidations in the cryptocurrency market, the price of Bitcoin fell below its all-time high in 2017, which placed a heavy burden on the entire cryptocurrency industry.
The broader crypto market didn’t expect such a sharp drop, especially below the “unbreakable” support of $19,000, but the cryptocurrency, as it sometimes happens, broke the $20,000 barrier.
Image: Crypto Academy
The price action is a response to the negative press surrounding the bitcoin sector, which began with pressure from macroeconomic forces.
As events unfolded, the US Federal Reserve raised its benchmark interest rate by three-quarters of a percentage point, the largest increase since 1994.
Too early for a major turn
“This recovery removes some of the oversold cryptocurrency,” said FxPro senior market strategist Alex Kuptsikevich.
“However, it is too early to talk about a long-term reversal: all the unfavorable fundamental factors remain in force,” he continued.
Crypto total market cap at $881 billion on the daily chart | Source: TradingView.com
The surprising rebound was also largely driven by a lack of selling on centralized exchanges as the vast majority of institutional and individual investors gave up during the weekend trading session as the Bitcoin network suffered a $7 billion loss.
Like equity investors, crypto investors are cautious in the face of a bear market rally, with some expecting the asset class to drop further before a substantial recovery occurs.
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Craig Erlam, senior market analyst at Oanda, cautions against getting too comfortable with a rising market, despite a modest recovery in traditional markets after the markets closed on the June holiday on Monday.
Erlam stated in the newsletter: “Everyone is looking for a bottom, but there is a huge cloud of uncertainty about the forecast and the data hasn’t shown any good performance yet.”
Featured image from Panorama Summit, chart from TradingView.com
Credit : www.newsbtc.com