Bitcoin is not doing badly off as it managed to rebound to its Jan 2021 opening price. Bitcoin has been working hard to avoid going below the $29,000 mark, according to market data
When Bitcoin moved past the $30,00 support, many anticipated that it would even go further low, to below $24,000. This, however, did not happen. On Wednesday, Bitcoin bounced back up such that BTC/USD was at $31K.
What does that mean?
Although Bitcoin is still more than 50% low from its all-time $65K, it has made significant strides to be where it is. According to Cointelegraph analyst Michaël van de Poppe, Bitcoin contradicting the market expectations shows that a retest may happen. It shows that bitcoin still has its initial trading patterns hence has not achieved optimum liquidity. That indicates that Bitcoin is yet to recover.
Orderbook data suggests a war between bears and bulls as there is a resistance building up at $31K, with bulls pushing the price higher by 5.5% on top of $30,900. That means that the support may level down to $29K.
It looks like Bitcoin still has a significant influence on altcoins. Its price movement affected altcoins in one way or the other. Ether, for instance, gained by 9% in a matter of hours. ETH had been previously affected by bitcoin, making it experience higher lows since the year started.
XRP increased by 6%.
The top 50 altcoins experienced up to 20%market capitalization gains, which pushed the total cryptocurrency market cap above $1.25 trillion.
What may be the trigger?
The significant sell-off in the crypto space might be the main reason for Bitcoin’s comeback. The New Jersey attorney general gave orders to BlockFi to stop offering interest-bearing accounts.
Many factors are affecting cryptocurrencies right now. The ongoing crackdown in China will affect crypto sooner or later. Binance is also facing regulatory issues from the UK, and that affects the industry in general. The volatility of the crypto space still stands, and we cannot accurately tell what the future holds.