Why the cryptocurrency market rose today…led by Bitcoin's rebound and Ethereum's strength

▲ Bitcoin, Cryptocurrency ©

The cryptocurrency market has rebounded from recent lows and is attempting to recover to the mid-$2 trillion range. As Bitcoin (BTC) leads the market trend, Ethereum's (ETH) strong upward momentum combined with improved investor sentiment has contributed to the short-term rebound.

According to CoinMarketCap, a cryptocurrency market data aggregator, on July 3 (local time), the total cryptocurrency market capitalization rose by 2.12% over 24 hours to $2.17 trillion. The correlation coefficient with gold over the past 30 days was 77%, indicating that investment demand as an inflation hedge asset amidst macroeconomic uncertainty was also reflected.

Bitcoin is at the center of this rebound. Bitcoin dominance remains at 57.83%, leading the market direction, and the total market capitalization appears to have entered a technical rebound trend after falling to $2.04 trillion on July 1. The Moving Average Convergence Divergence (MACD) histogram also turned into positive territory, signaling an improvement in short-term momentum.

Ethereum's strength also contributed to the market recovery. Ethereum rose by 12.09% over the past week, recording a clear outperformance compared to Bitcoin. Optimism spread on social media, mentioning Ethereum's technical rebound structure and the possibility of a cycle bottom, which is considered a factor that stimulated individual investors' buying sentiment.

However, some analysis suggests that it is necessary to confirm whether this upward trend is a full-fledged bull market transition. The total cryptocurrency market capitalization must maintain the short-term support level of $2.15 trillion, and if buying momentum continues, a test of the $2.21 trillion resistance level is possible. Conversely, if it falls below $2.15 trillion, the possibility of retesting the July low of $2.04 trillion increases. The 7-day Relative Strength Index (RSI) hitting 71, indicating a short-term overheated signal, is also a burden.

The market outlook is closer to cautious optimism. While this rebound is a trend of Bitcoin-led technical recovery combined with Ethereum's strength and improved investor sentiment, a clear single catalyst is lacking, and its sustainability has not yet been verified. Future US employment figures, the Consumer Price Index (CPI), and Bitcoin spot ETF fund flows are considered key variables that will determine whether this rebound extends.

*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*