Crypto Market Resurgence: A Blend of Factors
In an upward shift today, the cryptocurrency market showcases gains from Friday, attributing this surge to technical and fundamental factors. On June 17, the crypto market capitalization rose by more than 2% to a whopping $1.05 trillion, exhibiting a near 7.5% increase from its $975.25 billion low just two days prior. Interestingly, this market cap recovery commenced a day after the daily relative strength index (RSI) fell almost to 30, indicating a nearly "oversold" status. From a technical viewpoint, an oversold RSI often triggers a price recovery or consolidation.
Bitcoin and Altcoins: Oversold Bounce in Full Swing
Several key cryptocurrencies show signs of rebounding from their lows. Bitcoin, which accounts for about half of the total crypto market, has bounced back 8.5% from its June 15 low of $24,750. Similarly, Ether, the second-largest cryptocurrency, has seen an over 9% increase in the past two days. The previous week's underperformers, including Solana, Cardano, and Polygon, recouped 8-15% within the same timeframe.
BlackRock's Bitcoin ETF: Fueling the Crypto Upsurge
Beyond the technical bounce, rumors surrounding the approval of the first Bitcoin ETF in the U.S. have played a part in the crypto market resurgence. Investment powerhouse BlackRock, managing $9.5 trillion in assets, applied to the U.S. Securities and Exchange Commission (SEC) for a Bitcoin ETF on July 16. With a track record of 576 ETF applications and just a single rejection, the firm's move has boosted the crypto market by 4.5% since the application. Market analyst Lark Davis predicts that an SEC approval could result in BlackRock buying every Bitcoin on crypto exchanges.
Looking Forward: Crypto Market Predictions for H2 2023
Regarding the technical outlook, the crypto market has shown a bull flag pattern since April 2023, hinting at a potential continuation of its recovery trend towards a $1.37 trillion market cap in H2 2023 — a rise of 35% from its current value. However, bearish forces may aim to push the market cap below the bull flag's lower trendline, jeopardizing the bullish setup. In such a bearish scenario, the crypto market might retreat to the next major support level at $875.50 billion, a crucial benchmark from the June-November 2022 and March 2023 sessions.