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Digital currencies posted solid gains on Tuesday, as altcoins and tokens followed the bitcoin to new three-week highs. At the time of writing, all the main assets were in the green, a sign that downward pressure was slowly fading.
Market Update
The cryptocurrency market added $ 12 billion in value, exceeding $ 230 billion for the first time since 9 August. With the gain, digital assets have recovered $ 41 billion from their most recent market downturn.
Bitcoin's price rose 4.7% to $ 7.062, the highest in about three weeks. The main digital currency is traded up to $ 7,126.10 on Bitfinex.
The BTC now trades above the short and long term moving averages, offering further evidence of a bullish rise.
Altcoins and tokens were responsible for about half of the growth of the overall market capitalization. Cryptocurrencies other than bitcoin had a combined value of $ 107.5 billion, according to CoinMarketCap.
Among the top 20 coins, Dash was the strongest percentage of performers. Cryptocurrency earned 24.4% to $ 183.06.
IOTA was another solid player, with an increase of 16.6% to $ 0.688. Tron's TRX currency gained 13% to $ 0.027.
Meanwhile, Ethereum rose 4.4% to $ 289.04. Bitcoin liquidity added 4.7% to $ 553.95. XRP, the so-called banker's cryptocurrency, gained 6.2% in trade at $ 0.347.
Altcoins and tokens continue to hold a minority share of the overall market. At the time of printing, the bitcoin accounted for 53% of the total market capitalization.
Overall trade volumes have increased by more than 21% on Tuesday, but remain weak at only $ 12.9 billion. Historically, a strong uptrend in digital currencies is accompanied by trading volumes of over $ 20 billion.
The bear market not yet
Despite the recent acceleration in prices, digital assets remain firmly rooted in the bear market territory. This is unlikely to change anytime soon, although the rate of decline seems to have slowed considerably. Much of this can be attributed to the renewed stability of bitcoin. The main digital currency has seen its volatility decline dramatically in recent weeks, while speculators have lowered their bets to the bottom.
Whether the market will overtake its downward opponents will depend on the scale of the bitcoin rally. Crossing $ 7,000, the digital currency is observing a series of minor obstacles en route to $ 8,000, which offers more formidable resistance. Probably BTC will have to overcome this level and make it convincingly to trigger a bullish rise across the board.
At the moment there does not seem to be a fundamental commercial catalyst, although this could soon change a highly anticipated bitcoin-listed fund soon before the SEC's decision. The SEC announced at the beginning of this month that it will decide on the fate of VanEck SolidX Bitcoin Trust by September 30, although some analysts believe the decision will be postponed until next year. This could eventually work in favor of the bitcoin as the regulators give more credibility to the crypt securitization.
Disclaimer: The author owns bitcoins, Ethereum and other cryptocurrencies. It holds investment positions in the currencies, but does not carry out short-term or day trading activities.
Featured image courtesy of Shutterstock.
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