On Tuesday, financial markets staged a broad rebound as investors took advantage of price dips to buy on the low. U.S. stocks and cryptocurrencies saw a recovery, although prices remain significantly below pre-sell-off levels. By the close of trading, the S&P 500, the Dow Jones Industrial Average, and the Nasdaq all posted gains of 1.04%, 0.76%, and 1.03%, respectively. Gold fell by 0.63% due to weakened safe-haven demand.
According to Bitpush data, Bitcoin (BTC) climbed from a support level of $54,000 to a high of $57,100 on Tuesday, regaining support at the lower end of its trading range since the end of February. As of the time of writing, Bitcoin was trading at $56,051, marking a 24-hour increase of 2.25%. 
Altcoins experienced double-digit recoveries, with all of the top 200 tokens by market capitalization rising, excluding stablecoins. The meme token “Cat in a Dog’s World” (MEW) saw the strongest rebound, surging 39.8% to a trading price of $0.00568, while Notcoin (NOT) rose 30% and AIOZ Network (AIOZ) increased by 27.9%. The overall market capitalization of cryptocurrencies currently stands at $2 trillion, with Bitcoin’s market share at 55.9%.
Whales holding between 1,000 and 10,000 BTC have been buying on the dip. Data from blockchain analytics firm IntoTheBlock indicates that Bitcoin whales (large asset holders) seized the opportunity to accumulate during the price drop, while smaller investors sold off amid ensuing panic. IntoTheBlock analysts noted that crypto wallets holding 1,000 to 10,000 BTC, valued at approximately $56 million to $560 million at current prices, “showed confidence during the recent downturn, continuously increasing their holdings as prices fell.” 
Meanwhile, wallets holding less than 1 BTC “performed weakly, with holdings significantly declining during yesterday’s market slump.” Data collected by Farside Investors revealed that on Monday, net outflows from U.S. spot Bitcoin ETFs amounted to $168 million, with outflows concentrated in Grayscale’s GBTC, Fidelity’s FBTC, and 21Shares/Ark Invest’s ARKB, while inflows from competitors were very mild or flat. Bloomberg senior ETF analyst Eric Balchunas pointed out that the outflows represented only 0.3% of total assets under management for the ETFs. Additionally, he stated that the largest BTC spot ETF—BlackRock’s $18 billion IBIT—did not experience any net outflows.
Market analysts indicate that Bitcoin needs to reclaim the support level of $59,000. Bloodgood stated on the X platform, “A lot has changed in the past two weeks. If we were previously discussing whether BTC would break through $69,000, now we are focused on whether it can maintain the $51,000 level. Due to market volatility, Bitcoin has dropped 30% in the past two weeks.” 
He added, “However, we are not interested in the fundamentals of this part; we want to look at the charts, where a bottom is forming slightly below $50,000, and a rebound is underway. If we want to see a continuation of the rebound soon, we need BTC’s weekly chart to close above the critical weekly level of $59,000. Otherwise, we may soon see levels below $50,000.” Bloodgood remarked, “Since Bitcoin failed to create a higher high on the weekly chart, we now have three lower highs and three lower lows, indicating that we are still in a downtrend. Unless this situation changes, I will not feel comfortable looking for bullish opportunities; I will continue to wait until the trend shifts.” 
Regarding Ethereum’s movement, Bloodgood believes, “Similar to BTC, ETH needs to reclaim $2,600, which is the key level that could drive ETH toward $4,000. If this does not happen, we may see it test $2,000; on the other hand, a breakout above this level would allow ETH to reach $2,800 and then $3,300.” According to Tuesday’s CryptoQuant market report, the BTC Market Value to Realized Value (MVRV) ratio has fallen below its 365-day moving average, a situation historically indicative of continued price declines. The report noted that this same critical support level was breached during the COVID-19 crash in March 2020, during the downturn in May 2021, and at the onset of the bear market in November 2021.
Analysts added, “Investors should monitor these valuation indicators to assess the likelihood of a price rebound or further pullbacks.” 
Ki Young Ju, founder and CEO of CryptoQuant, analyzed on the X platform, “As long as Bitcoin can stay above $45,000, it may break its all-time high again within a year. Although some indicators are currently showing bearish signals, there is still potential for a rebound. Therefore, it’s important to observe whether it can hold at this level for a week or two. If the duration is longer, the risk of a bear market increases, and if it lasts over a month, recovery may become difficult.”
Author: BitpushNews Mary Liu
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