Bitcoin shows sellers exhaustion
Bitcoin surged above $56,000 early on Tuesday, amid a general market rebound in Asia as bargain hunters entered the market
Bitcoin surged above $56,000 early on Tuesday, amid a general market rebound in Asia as bargain hunters entered the market following Monday’s sharp decline.
According to Binance data, Bitcoin increased by 6% for the day, marking the largest daily gain since May. This led to a broader market recovery.
Risk appetite increased when the yen lost strength against the US dollar, causing Japan’s Topix to jump around 10%. The tech-heavy Nasdaq 100 futures surged 2.1%, while futures tracking the S&P 500 increased 1.5%.
Following Monday’s worldwide market decline, there appears to be a renewed optimism about quicker Fed rate cuts, which has improved risk sentiment. Nevertheless, observers of the cryptocurrency market are still wary about a sustained upswing in the major tokens.
Overall, the recent reduction in Bitcoin’s price is not statistically worse than the decline in the Nikkei index, suggesting that outside causes rather than problems with the cryptocurrency market itself are driving the present attitude.
On the same day, there were varying reports that the Federal Reserve contemplated calling an emergency meeting to evaluate the situation. The sell-side volume significantly reached the Seller Exhaustion levels observed during prior upward price reversals.
While US equities avoided following the example set by their Asian counterparts, bitcoin sellers lost pace and the price of bitcoin strengthened again at the opening of Wall Street.
Binance data revealed that the price of Bitcoin surged to $4,000 after the US trading day began. Bitcoin put traders on edge after falling below $50,000 for the first time since February, with many predicting more declines when TradFi markets opened back up.
Within three days, Bitcoin saw its biggest loss since the FTX crash, falling almost 20% between Friday and Monday AM. With this move, the cryptocurrency market has lost over half a trillion dollars since August 1.
The market was further impacted by a slew of negative headlines, including lower-than-expected Non-farm Payroll (NFP) data, geopolitical tension in the Middle East, the Japanese raising interest rates, and Kamala Harris’s higher odds on Polymarkets. These factors were compounded by a low liquidity weekend.
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