Following a run above $40,000 yesterday, Bitcoin is settling below $38,000, while altcoins are handing back the majority of their gains.
Bitcoin’s brief rise above $40,000 the previous day, which helped spark a rally across the market and rekindled investor optimism, the larger cryptocurrency market entered a phase of stabilization on Tuesday.
A mid-day attempt by bulls to boost the price of BTC back above the $40,000 barrier was rebuffed, according to data from Cointelegraph Markets Pro and TradingView, which caused a price fall to $37,500.
Others point to the growing Grayscale Bitcoin Trust (GBTC) premium, which is currently at its greatest level in months at -5.88%, showing that institutions are once again banking on further price gains. Tuesday’s price drop may signal that Monday’s surge was simply a short push.
Bitcoin Bulls Fight to Construct an Upswing Once Again
The market-wide spike on Monday was sparked by rumors that Amazon might start accepting cryptocurrency payments in 2021, albeit this was later formally denied by the firm.
However, the price chart for Bitcoin displays a geometric pattern that is comparable to the price performance in October 2020, shortly before the price of BTC started its run to a new all-time high, as noted by anonymous independent market analyst Rekt Capital.
The upward trend in Bitcoin’s price that the Amazon rumors started will be maintained if a similar pattern emerges in the present market.
Nevertheless, not all of this points to a continuation of the upward trend, as noted by Jarvis Labs analyst and co-founder Ben Lilly, who has been observing on-chain data to acquire a deeper understanding of the most recent pump, particularly with Ethereum‘s London hard fork scheduled on August 4.
The anonymous Twitter account Bear Wolf, who described Monday’s developments as little more than a short squeeze within a larger bear market, presented an example of negative bias.
Altcoins Provide Returns
As the excitement over the Amazon speculations ceased on Tuesday, a significant portion of the gains witnessed in the altcoin market on Monday was handed back.
In the top 20, Dogecoin and Solana (SOL) suffered losses of 10% and 10.8%, respectively, while Monday’s top performers’ Strike (STRK) and Venus (XVS) both had losses of 16%.
The strongest performances of the day were a pair of 30% rises from Axie Infinity (AXS) and MyNeighborAlice (ALICE), while the price of the blockchain-based identity management system Civic (CVC) emerged by 20%.
Currently, there is $1.488 trillion worth of cryptocurrencies in circulation, with Bitcoin having a 47.8% market share.