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

▲ Bitcoin, Cryptocurrency ©

The cryptocurrency market is attempting to recover to the mid-$2 trillion range again, rebounding from recent lows. Bitcoin (BTC) is leading the market trend, with Ethereum's (ETH) strong upward momentum and improved investor sentiment combining to boost 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, reaching $2.17 trillion. The correlation coefficient with gold over the past 30 days was 77%, suggesting that investment demand for inflation-hedge assets in the midst of macro uncertainty was also reflected.

Bitcoin is at the center of this rebound. Bitcoin dominance remains at 57.83%, driving 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 analyses suggest that it is still necessary to confirm whether this rally marks a full-fledged bull market transition. The total cryptocurrency market capitalization needs to maintain the short-term support level of $2.15 trillion, and if buying momentum continues, it could test the $2.21 trillion resistance level. 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, signaling short-term overheating, is also a burden.

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

*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.*