In a remarkable turn of events, Bitcoin (BTC) and the broader cryptocurrency market have experienced a 4% surge, almost recovering early week losses. As of press time, Bitcoin’s price has increased by 4.59%, trading at $26,920 and boosting its market cap by $21 billion in just the last 24 hours.
It’s important to note that this strong recovery comes in the wake of recent regulatory developments. On Tuesday, June 6, the broader cryptocurrency market found itself in a downward spiral after the SEC announced a lawsuit against Binance. Later, the SEC went after Coinbase, accusing the major crypto trading platform of violating securities laws.
Despite these regulatory hurdles, investors seem to be looking forward and adopting a “buy the dip” mentality. As a result, BTC and ETH registered a V-shaped recovery, demonstrating investor resilience in the face of regulatory challenges. At the time of writing, ETH is up 3.64% and trading at $1,878.
A recent report from Greeks.live sheds light on this week’s events, stating that while the V-shaped recovery is noteworthy, it doesn’t necessarily guarantee a return to pre-crash levels. The report suggests that the bearish sentiment in the market is still prevalent, making it difficult for ETH to climb back above the $2,000 mark.
On-chain data from Binance revealed that traders who bet against the market found themselves at a loss as numerous shorters were liquidated during this strong recovery period. According to Santiment, the largest shorts in the last three months acted as a catalyst for the price bounce in Bitcoin.
Moreover, the buy-the-dip sentiment in the market escalated as crypto prices tumbled earlier this week. Santiment shared on June 6, “As there was increased crowd buy the dip interest as crypto prices plummeted yesterday, it was shortly after the crowd gave up when prices began to soar.” This suggests that contrarian traders could benefit from deviating from mainstream hype.
While the recent V-shaped recovery in the crypto market may signal optimism and investor resilience amidst regulatory uncertainty, it’s crucial to acknowledge that the market’s bearish sentiments remain strong. As always, thorough market research is essential before making any investment decisions in the world of cryptocurrencies. The future of the market remains unpredictable, and it is crucial to be prepared for any potential shifts or challenges.
Source: Coingape
