Over the past 24 hours, Bitcoin has rebounded from $7,000 to $7,100, remaining on top of a key resistance level which traders were concerned about.
Despite the relatively strong performance of Bitcoin, tokens understandably have not performed well against both Bitcoin and US dollar on August 29, considering the massive gains they recorded earlier this week.
EOS has been the third best-performing cryptocurrency on August 29, a rare sight for a major cryptocurrency, especially for a digital asset that is in the top five rankings alongside Bitcoin, Ethereum, Ripple, and Bitcoin Cash.
Apart from Dash, IOTA, and Golem, most tokens and small market cap cryptocurrencies have struggled against Bitcoin.
Volume is Slowly Coming Back
In previous reports, CCN emphasized that the daily trading volume of most major cryptocurrencies has been an issue, as the recovery of the market was initiated without a proper rebound in the volume of large market cap cryptocurrencies.
Throughout the past 24 hours, the volume of Bitcoin has remained above the $4.5 billion mark, as the daily volume of the crypto market surpassed $13 billion. However, the volume of Ether, the native cryptocurrency of Ethereum, has hovered at around $1.5 billion, which still remains relatively low in comparison to Bitcoin.
The high trading volume of Tether at $3 billion in a strong short-term recovery period suggests that traders are moving out their funds from the US dollar-backed stablecoin to Bitcoin and other cryptocurrencies.
If the volume of the crypto market can be sustained at $13 billion and potentially increase to $15 billion throughout the week, it is highly likely that Bitcoin tests key resistance levels in mid-$7,000, eyeing a move towards the $8,000 mark.
The recovery in the volume has been supported by optimistic developments in Japan and South Korea, as UPbit and Bithumb, South Korea’s two largest cryptocurrency exchanges, have resumed normal operations after being involved in a few scandals.
Crucially, Bithumb has been able to regain its partnership with NH Bank, a major financial institution in South Korea, to support new traders and investors. Experts have stated that the resumption of new registrations on Bithumb will lead to an influx of capital in the cryptocurrency market of South Korea, which has stagnated since mid-2018 after the seizure and raid of Bithumb and the $40 million security breach endured by Bithumb.
Based on the performance of cryptocurrencies over the past three days and the reluctance of the market to demonstrate overbought conditions, it is likely that tokens will continue to perform well against both Bitcoin and the US dollar, as Bitcoin eyes a move towards $8,000.
The majority of traders in the cryptocurrency community have suggested that if Bitcoin breaks out of the $7,200 resistance level in the next 24 hours by recording three consecutive large buy candles on its 1-day chart, it will confirm a short-term bull rally and increase the probability of Bitcoin achieving $8,000 in the weeks to come.
Featured image from Shutterstock. Charts from TradingView.