What started as a slow American morning in the crypto markets has taken a rapid turn with bitcoin resumes the $94,000 level.
Hovering just above $90,000 earlier in the day, the largest crypto rallied back to $94,000 minutes after 16:00 UTC, gaining more than $3,000 in less than an hour and up 4% over the past 24 hours.
Ethereum’s Ether jumped 5% in the same period, while native tokens of and Chainlink climbed even more.
Action fell while silver rose to new record highs above $60 an ounce.
While broader equity markets remained flat, crypto stocks followed bitcoin’s rise. Digital investment firm Galaxy ( GLXY ) and bitcoin miner CleanSpark ( CLSK ) led the way with gains of more than 10%, while Coinbase ( COIN ), Strategy ( MSTR ) and BitMine ( BMNR ) rose 4%-6%.
Although there was no single obvious catalyst for the rapid move higher, for several weeks BTC has mostly sold off along with the US market open. Today’s pattern change could point to seller fatigue.
Vetle Lunde, lead analyst at K33 Research, pointed to “deeply defensive” positioning in the crypto derivatives markets, with investors worried about further weakness and crowded positioning possibly contributing to the quick snapback.
Further signs of bear market capitulation also emerged on Tuesday, with Standard Chartered bull Geoff Kendrick lowering his outlook for the price of bitcoin for the next several years.
The Coinbase bitcoin premium, which shows the BTC spot price difference on US exchange Coinbase and offshore exchange Binance, has also turned positive over the past few days, signaling a rebound in demand from US investors.
Looking deeper into the market structure, BTC’s daily gains exceeded the increase in the derivatives open rate, suggesting that spot demand is driving the rise rather than leverage.
The Federal Reserve is expected to cut key interest rates by 25 basis points at its two-day meeting ending Wednesday. While the interest rate cut is widely expected by market participants, looser financial conditions with a robust US economy could help strengthen risk appetite in the markets.
UPDATE (December 9, 16:55 UTC): Adds details on capital gain versus increase in open interest.
