The cryptocurrency market has been in a continuous downtrend. Most of the cryptocurrencies have lost more than 50% of its value. However, Bitcoin is showing signs of reversal. From highs of $ 20,000, Bitcoin has fallen to around $ 7600. Since then, it is increased to around $ 9200.
This marks an increase of approximately 20% from the bottom. Thus, investors are starting to ask the question whether Bitcoin is posing a reversal or whether this is just a dead cat bounce.
Similarly, Ethereum fell to levels of around 800. Since then, Ethereum has also risen to about 900. Thus, the bounce in cryptocurrencies is not just limited to Bitcoin.
Similarly, the ripple also fell to around $ .70 from a high of $ 3.3. This marks a decrease of around 75%. Since then, ripple has also bounced from the temporary bottom, it has risen to around $ .95.
Previously, whenever there was a bounce, it was just limited to a single or a couple of cryptocurrencies. Also, it was news driven which was pertaining to only that particular cryptocurrency. However, the current bounce which is happening in cryptocurrencies broad-based. Most of the cryptocurrencies are up at least 15% from the bottom which they have formed in the last 48 hours. If the momentum continues, this can surely work as a long-term bottom as well as most of the cryptocurrencies have fallen significantly.
Investors are still in 2 minds as to whether this is the right investing level or whether this is just a dead cat bounce. Only the volumes and the trends in the next 48 hours would determine whether this is just a temporary bounce or whether the cryptocurrencies would rise once again from these levels.
Also, the experts are divided as well as most of the experts are not sure whether the cryptocurrency would rise again. This is one of the main reasons why broad-based buying is not still visible in cryptocurrencies. Many of the retail investors have already burned their fingers as well. Owing to this very reason, they are still not participating in the rally. Moreover, the retail investors are very scared due to experiencing volatility in the cryptocurrencies in the last one month. This is another reason why the movement is still pretty less.
With the help of the trends in cryptocurrency in the next one week, it would be pretty clear whether it would rise further or whether it would just face more volatility.