Following a dynamic start to the day, Bitcoin (BTC) maintained a steady position near $87,500 during U.S. afternoon trading, preserving approximately a 2% gain over the previous 24 hours. Other cryptocurrencies such as Ether (ETH), XRP, and Solana (SOL) mirrored this upward momentum.
Stocks linked to the cryptocurrency sector also experienced rebounds after Monday’s sharp decline; for instance, Strategy (MSTR) rose by 3%, while Coinbase (COIN) increased by around 1%.
For further details: Bitcoin recovers from Monday’s lows but may dip below $80,000 soon, analysts warn
“Our clients are cautiously optimistic,” explained Josh Barkhoarder, FalconX’s head of sales. “In the short term, most anticipate crypto will trade within a range until a significant catalyst emerges. Consequently, they maintain core bitcoin holdings and keep cash reserves elsewhere.”
Analyst suggests BTC could gain from portfolio rebalancing
As the year-end approaches, bitcoin might benefit due to its relatively weak performance compared to other asset classes this quarter. Asset managers could rebalance their portfolios to meet allocation targets,” said Vetle Lunde, K33’s head of research.
Lunde pointed out that earlier in the year when BTC lagged behind the S&P 500 during Q1 performance-wise, it started Q2 with gains. Conversely, when BTC outperformed equities in Q2 it faced declines at Q3’s onset.
This quarter so far has seen bitcoin underperforming against the S&P 500 by roughly 26%, indicating potential for substantial portfolio adjustments ahead.
“Fund managers aiming for specific BTC allocations might tweak their positions toward year-end,” Lunde added. “This could lead to significant inflows during late December and early January.”
Cautious stance among crypto traders persists
Despite price stabilization efforts across markets,K33’s Lunde noted that many participants remain reluctant about taking on additional risk at this time.
The Chicago Mercantile Exchange (CME) shows derivatives activity close to annual lows with open interest in BTC futures steady around 124K coins.He also mentioned perpetual swap funding rates hovering near neutral levels alongside stagnant open interest figures — all signs pointing towards limited short-term directional confidence among traders.
A decrease of approximately twelve percent in spot crypto trading volumes through last week further confirms widespread trader hesitancy as we approach year-end festivities.