After a near non-stop bout of selling pressure, on Tuesday, after a seeming shift in the crypto-related news cycle, Bitcoin and its altcoin brethren unexpectedly underwent a positive price influx. And after a day of buy-side action, the aggregate value of all crypto assets has risen to $135 billion, 15% higher than the $115 billion year-to-date low seen on Sunday.
Crypto’s most recent rebound, which sent BTC from $3,800 to a daily high at $4,375 (~11% gain), came alongside $20 billion in reported volume (24 hours), as claimed by data aggregator CoinMarketCap. Bitcoin’s most recent move comes just days after the asset established a fresh yearly low at $3,400, 40% down from its late-Summer/early-Autumn ‘home’ around $6,000.
Still, as with crypto’s previous bouts of price action in the past 15 days, many investors were left scratching their heads, wondering why and how BTC did what it did, and, arguably more importantly, where the cryptocurrency market could be headed next.
Analyst: Pay Attention To $3,500
Like Mati Greenspan, eToro’s in-house crypto expert/analyst, Alexander Kuptsikevich, a market analyst at FX Pro Insights, has looked to the $3,500/bitcoin price level as an area of interest, telling MarketWatch:
It is worth paying attention to the market behavior near $3,500. This is an area that saw drastic increase back in September 2017, so technical analysis urges us to track the price dynamics near these levels
This claim, as reported by Ethereum World News previously, has become an increasingly important line of support in the eyes of analysts. On Monday, Nick Cawley, also of a forex trading firm, told the same outlet that taking the lack of “news to drive the move” into account, BTC is likely to bottom between $3,500 and $3,700, even if sell-side volume continues to ramp up.
Bitcoin Crash Might Have Been An “Overreaction”
But what caused the uptick?
Well, as noted by Andy Bromberg, president at ICO platform CoinList, “today’s rise is mostly a reaction to the precipitous drops last week and people thinking that may have been an overreaction.” He then added that due to the low liquidity levels seen on crypto exchanges, a single bullish whale can trigger a cascade of buy orders, “an avalanche” as the CoinList exec put it, further pushing up prices.
Brian Kelly of BKCM also weighed in on BTC’s recovery, noting that now that Bitcoin Cash’s hash wars are mostly over, and have receded from the limelight, sellers have left the market.
Then Again, It Might Have Been A Dead Cat Bounce
Still, not everyone is convinced that the worst is over.
Clem Chambers, CEO of one Online Blockchain, noted that “this morning’s move is a dead cat/crypto bounce,” indicating that he expects for BTC to fall further, even taking Tuesday’s strong move into account. Chambers claimed that $2,000 per bitcoin is in the realm of possibility.