Bitcoin price appears to be oversold, support a brief rise toward the $60,000-$63,000 resistance zone

Bitcoin price struggled to break above $58,000 yesterday, while altcoins, including Ether and other class 1 tokens, recovered above their seven-day lows. The market-leading cryptocurrency has held short-term support at around $56,000 as selling pressure has stabilized. At the time of writing, BTC is changing hands at $57,587.

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BTC/USD 4-hour chart | Source: TradingView

Altcoins outperform as Bitcoin price stabilizes

Bitcoin dominance chart shows how dominant the cryptocurrency is relative to the rest of the market, further signaling a trend towards altcoin exposure which, according to TradingView, is down to around 42.38% vs. with an October high of 47.41%.

bitcoin-price-appears-to-be-oversold-support-a-brief-rise-toward-the-60000-63000-resistance-zone1

Bitcoin dominance chart | Source: TradingView

The Relative Strength Index (RSI) rises from oversold levels, similar to what happened on Oct. 27, which preceded a price recovery. On the daily chart, the RSI is approaching oversold levels for the first time since late September.

Further, Bitcoin’s correction from an all-time high of nearly $69,000 appears to be exhausted, which could encourage buyers to return. Momentum is improving into the Asian trading day, although resistance at around $63,000 could limit further upside over the short term.

“Bitcoin’s key active whale addresses that hold between 100 to 10k BTC are content after accumulating a total of ~40k more BTC on last week’s dip”, Santiment stated.

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Source: Santiment 

Bitcoin is struggling to consolidate as an inflation hedge but is also not following risk assets, leaving some investors uncertain. Meanwhile, Ether has been more closely correlated to stocks, suggesting that investors treat it more like a risk-on trade.

Bitcoin is up about 3% over the past 24 hours, compared with an 8% rise in Ether. Alternative cryptocurrencies are gaining ground relative to bitcoin, suggesting that traders take on more risk as the recent sell-off stabilizes.

Most cryptocurrencies in the market ended the day higher. The overall cryptocurrency market cap now stands at $2.612 trillion, and Bitcoin’s Dominance rate is 42.38%.

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