Bitcoin has recovered all losses from its big leverage flush out in just two days as it reclaims a key price level.
Bitcoin prices have recovered to exceed $93,000 again during early trading in Asia on Wednesday morning. The move comes less than two days after it dumped to $84,000 in the latest violent leverage flush.
The asset has now recovered all losses from that drawdown and is sitting at a crucial resistance point. The move has also reignited market sentiment, which has turned bullish once again in this very unusual cycle.
Analyst ‘Daan Crypto Trades’ observed the monthly candle sweep, stating, “whenever a new month instantly moves up or down, and leaves no wick or anything behind, these levels are often taken out. This was a very quick and clean example of that.”
He also observed that the total crypto market capitalization retook June lows, “and is showing some solid low time frame strength.”
“For December to be able to show some further relief, you’d want to see this start making those higher lows and higher highs on the low time frame first. Breaking last week’s high would confirm such a local higher high.”
Total cap is currently $3.2 trillion, according to CoinGecko, down around 27% from its all-time high of $4.4 trillion in early October.
Glassnode reported that “large short-liquidation clusters” were forming, but this is not necessarily a bad thing as “short liquidations can act as fuel for upside, as forced buyers amplify momentum.”
Meanwhile, analyst ‘Sykodelic’ echoed the bullish sentiment, stating, “Everyone on the timeline was absolutely losing their minds yesterday with that dip. But it was exactly what we wanted to see.”
However, analyst ‘CryptoCon’ wasn’t so bullish, labelling the latest move a bear trap. “On every price bump, you’ll see: ‘Bottom’s in, new ATHs soon.’ That’s the bear market trap,” he said before adding:
“The bear market usually takes the full year to play out, so it’s a long, painful process.”
Bitcoin’s rebound has been good for Ether, which shadowed it, reclaiming $3,000 once again. This is also a key resistance level for the asset, which needs to show strength above it to retake $3,400 next.
Many of the altcoins were seeing greater gains, with Solana adding almost 10% to reach $140, Cardano up 12.5% to $0.44, and Chainlink surging 15% as it approached $14.
