Bitcoin, ethereum, Ripple’s XRP, litecoin and chainlink—five of the biggest cryptocurrencies by value—have bounced back from a sell-off this week.
The upswing has been led by XRP, which added over 10% over the last 24 hours, with bitcoin, ethereum, litecoin and chainlink climbing around 5%.
The sell-off, which saw bitcoin lose 10% of its value in a matter of hours, was taken as by many bitcoin and cryptocurrency market watchers as temporary correction.
“Crypto prices can show sharp fluctuations, so the main thing to know is that this stage was needed to continue the rally,” Alex Kuptsikevich, FxPro senior financial analyst, said via email.
“Technical indicators have been in the extreme overbought territory for too long. The rally started to choke up on the way to $20,000. This is a very serious psychological and technical level of resistance for the market, and there was no doubt that this obstacle would test investors’ optimism.”
Bitcoin has added almost 40% through November, pushed on by its growing reputation as digital gold, interest from big banks on Wall Street and a raft of high-profile investors naming it as a potential hedge against inflation.
The bitcoin rally, sparked by news payments giant PayPal