The crypto market has demonstrated a transient corrective rally in the past 24 hours after major assets like Ethereum showed solid oversold conditions.
ETH, the native cryptocurrency of the Ethereum blockchain network, has been on an increased downtrend since June, performing particularly ineffectively against Bitcoin.
On September 13, ETH has demonstrated resilience in the sub-$200 regions, bouncing back to $188 by recording a solid 9% growth in price. The recovery of Ethereum led to the price surge of tokens, empowering Decentraland (MANA), VeChain (VET), WanChain (WAN), (AION), ICON (ICX), and 0x (ZRX) to increase by 10 to 20%.
Meaning Of Market’s Recovery:
Even during a restorative rally, the market has demonstrated a similar pattern in the past three months. In the past 24 hours, Bitcoin has recorded a slight increment in esteem, rising by 2 percent to $6,400. The rest of the market, which experienced extraordinary unpredictability all through September, indicated increased developments on the upside.
Since February, the crypto market has tried the $200 billion regions four times, in February, April, June, and August. Throughout all of the corrections, Bitcoin has indicated stability in the low price range while others, such as Ethereum, Bitcoin Cash, Ripple, and small market cap cryptocurrency have struggled to demonstrate flexibility.
The minor development in the value pattern of Bitcoin rather than the development of the rest of the market recommends that the market has indicated exhaustion in the low-value range. Since both major cryptocurrency and tokens endured against Bitcoin already, it has become more difficult for bears to push the market below its current price range.
Economist and digital money trader Alex Kruger clarified:
“Volume that extreme speaks of exhaustion and ‘a’ bottom. Similar exhaustion volume can be observed in Binance, Bitmex and most exchanges, both against the USD and BTC.”
But, as specified above, the remedial rally of September 13 was caused by extremely oversold conditions, which does not necessarily lead to a mid-term rally or a total trend inversion. As Kruger noted, it is possible for Ethereum and the rest of the market to proceed with their recovery in the upcoming days but endure another drop on the downside.
Kruger further included that “Direction of ETHUSD relies upon BTCUSD. In the event, if BTC breaks $6,400 next levels are $6,600 – $6,650 and $6,850. ETH would break up considerably harder. At that point expect that selloff will continue, BTC to break the year lows, hellfire among alts, and ETH weaker than competing tokens. That is my view atm”.
The digital currency market is still bottoming out and has not recovered from its 80% correction. While it is hard to see the market starting another large correction preceding a mid-term recovery, major digital currencies like Bitcoin and Ethereum will probably stay in low value run for weeks to months before recovering to their past levels.
In short-term, experts consider the probability of Bitcoin breaching the mid-$6,000 regions to be relatively high, bringing rest of the market with it to the upside.