Blockchain analytics firm Santiment notes that bitcoin bullish move has surprised prevailing bearish market sentiment. They also point out that it should pay attention to a possible increase in whale addressesthat is, from large cryptocurrency holders, as it could be “a sign of greater confidence from the main stakeholders.”
Why do cryptocurrencies bounce?
The strong rebound surprises the market after the road map that the Federal Reserve (Fed) will take after inflation data was glimpsed. According to Coinglass data, total bitcoin short liquidations in the last 24 hours have risen to $85 million.
Also, there seems to be a Growing optimism among investors in the bitcoin derivatives market. According to this data provider, the open interest (OI) in the bitcoin perpetual futures market shows that traders are building long positions. Furthermore, funding rates have been predominantly positive showing a willingness to go long. On the other hand, stocks show less volatility, and the drop in oil and the weakening of the dollar benefited the digital currency.
According to Noelle Acheson, former director of market insights at Genesis, everything revolves around recovering the liquidity of bitcoin, since no risky asset has experienced such a significant drop as the largest ‘crypto’ on the market. “The BTC narrative is multifaceted; This also gives your floor a strong support. For some, it’s a store of value; for others, an early-stage liquid technology investment; for many, pure speculation, partially based on narratives driven by the first two. Complicated and fascinating,” he explains.
For his part, Joey Krug, investment director of Pantera Capital, has indicated in an interview on CoinDesk TV that the market already bottomed out last summer and that this rebound is confirmation of the recovery. “Markets are likely to continue to suffer cuts as inflation is not advancing as fast as expected. My opinion is that things were oversold last summer and they are finally recovering. The second half of the year is going to be bullish for cryptocurrencies. Most of the people who thought of selling ‘crypto’ have already sold”, he stressed.
Source: Ambito
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