The cryptocurrency market staged an impressive recovery on Tuesday, with Bitcoin reclaiming the $87,000 level and major altcoins posting even larger percentage gains. The rebound comes after a weekend filled with pessimism, rising downside predictions, and a noticeable deterioration in investor sentiment. But a powerful comeback in U.S. equities — particularly the Nasdaq Composite, which recorded its strongest session since May — injected renewed risk appetite into global markets, spilling over into digital assets.
Across the board, crypto traders rotated into higher-beta altcoins, while derivatives activity painted a more complex picture, highlighting both renewed bullish speculation and lingering concerns about broader macro uncertainty and technical downtrends.
Below is a deep breakdown of price action, derivatives positioning, market drivers, and sector-specific trends shaping today’s crypto landscape.
Bitcoin Reclaims Momentum as Sentiment Improves
Bitcoin (BTC), currently priced at $87,164, climbed 1.8% in the last 24 hours, briefly touching $87,250 during the afternoon session. The flagship cryptocurrency finally pushed back against the weekend’s negativity, where a steady grind lower and a cluster of bearish analyst predictions contributed to a sharp drop in sentiment.
Despite the recent upswing, analysts emphasize that Bitcoin’s longer-term technical structure remains in a confirmed downtrend, marked by lower highs and lower lows since early October. This suggests that macro-level caution persists even as the short-term picture brightens.
Even so, Tuesday’s strength signals that investors are not ready to abandon risk assets — especially when equities flash signs of renewed momentum.
Altcoins Outperform as Traders Rotate Into Risk
While Bitcoin regained footing, altcoins stole the spotlight. A number of high-beta tokens, including SUI, ENA, BONK, and CC, surged anywhere between 8% and 11%. These tokens had previously suffered during the past week’s selloff, making them attractive candidates for rebound hunters looking to capitalize on shorter-term volatility.
Ethereum (ETH), meanwhile, advanced 3.3%, easing some pressure after a month-long decline that wiped out more than 25% of its value. ETH traded around $2,907, and while still well below the $3,500 level needed to break its broader downtrend, the improvement in daily trading volume (up 13% to $27.3B) suggests returning buyer participation.
Despite the short-term enthusiasm, analysts caution that the macro trend remains decisively bearish for most altcoins, which continue to structure lower highs and lower lows across multi-week and monthly timeframes.
Privacy Sector Lags ZEC and DASH Retreat
One notable laggard in today’s recovery was the privacy coin sector. Two standout movers:
- Zcash (ZEC) dropped 6.6%, cooling off after a two-month rally that pushed it into overbought territory based on RSI readings.
- DASH also turned red, unable to participate in the broader market rebound.
Analysts note that these pullbacks are natural after a period of strong relative outperformance and may reflect profit-taking rather than structural weakness.
Meanwhile, the average crypto RSI stands at 50.34, underscoring broad indecision across the market — a tug-of-war between negative sentiment and increasingly strong daily price action.
Why the Crypto Market Is Rebounding The Nasdaq Effect
A large part of Tuesday’s rebound can be attributed to the crypto market’s increasingly strong correlation with U.S. equities. The Nasdaq Composite Index jumped sharply, marking its biggest daily gain since May, driven by renewed demand for risk assets and easing concerns around interest rates and economic slowdowns.
Crypto, being one of the highest-beta risk categories, naturally followed suit.
This correlation reinforces a growing trend: crypto markets are not operating in a vacuum, and traditional macro drivers — equity flows, investor risk tolerance, and economic sentiment — continue to dictate near-term direction.
Derivatives Market Complex Signals Behind the Rebound
A closer look at derivatives reveals a nuanced mix of optimism and caution:
Volatility Index (BVIV)
- Bitcoin’s 30-day implied volatility slipped from 65% to 55% since Friday.
- This signals reduced expectations of near-term turbulence, though volatility remains elevated historically.
Options Skew & Positioning
- Put skews remain intact for both BTC and ETH, showing ongoing hedging and downside worry.
- However, the gap between puts and calls has narrowed — a sign of improving sentiment.
- Ethereum options show distinct bullishness for long-dated expiries beyond August 2026.
BTC $100K Call Demand
One standout trend is renewed trader interest in $100,000 BTC call options, pushing their notional open interest to $2 billion, matching the OI of major downside puts ($85K and $80K).
This suggests traders see a potential for large upside moves in 2025 — even as they hedge short-term risk.
Popular Strategies
- For BTC, call condors continue to dominate 24-hour block flows, especially those targeting ranges above $100K.
- For ETH, strangles are the preferred structure, reflecting neutrality and expectations of broader future volatility.
ETF Options
Options linked to BlackRock’s IBIT spot bitcoin ETF saw renewed demand for upside calls, though put-call skews continue to favor portfolio protection.
Futures Market
- XRP leads the futures sector, with open interest rising 12% to its highest level since Oct. 11.
- BTC perpetual futures OI continues to decline, signaling low conviction in the ongoing bounce.
- Funding rates flipped negative for the first time in five weeks, indicating excess short interest and potential for future short squeezes.
Altcoin Sector Highlights
SUI & ENA
Both tokens surged over 11% as speculative traders bet on short-term reversals following significant pullbacks.
Ethereum (ETH)
- Up 3.3%
- Daily volume climbed 13%
- Needs a sustained move above $3,500 to confirm a bottoming pattern
Privacy Tokens
- ZEC: –6.6%, cooling from strong overbought levels
- DASH: Continued weakness against broader market strength
Market Outlook Short-Term Strength Meets Long-Term Downtrend
While today’s rally injects fresh optimism into risk markets, the structural picture remains mixed:
- Short term: Strong rebound, improving sentiment, rising volume, reduced volatility
- Medium term: Range-bound action, high derivatives hedging, negative funding rates
- Long term: Clear downtrend defined by lower highs and lower lows across BTC and ETH
The key question:
Is this rebound the start of a trend reversal — or another relief rally within a broader correction?
For now, traders appear eager to engage, but the market continues to flash enough cautionary signals to prevent a full-scale bullish shift.
