Jul 21, 2022 03:30AM ET
Bitcoin regained its price level, which has not been seen since mid-June.
On Wednesday, the dominant cryptocurrency soared to $24,195, marking a more than 5% increase over the past 24 hours and a 20% increase overall over the past 7 days.
Various indicators are showing optimistic signs of recovery in the crypto market, but larger macroeconomic factors remain unclear and uncertain.
General market sentiment has finally left the extreme fear zone of the Crypto Fear and Greed Index and settled into the fear zone for the first time in April.
The recent surge in the price of Bitcoin has brought the ratio of long to short orders on Bitcoin to its highest point since early May, says cryptanalysis firm Santiment.
The ratio represents the availability of assets for short sales compared to the amount borrowed and sold. The traditionally higher ratio indicates positive investor sentiment.
In addition to this, the number of small Bitcoin holders has been increasing for some time now.
As indicated by blockchain data analytics firm Glassnode, the number of wallets holding 0.1 to 1 Bitcoin has increased significantly over the past month, when the BTC price hovered around the $20k level.
Moreover, the number of wallets with non-zero BTC has accordingly reached an all-time high of 42.5 million, Glassnode reports.
Major stock indices, such as the Dow Jones and the S&P 500, recovered from last month's losses.
Optimistic sentiment returned after corporate reports showed better-than-expected second-quarter financial results.
The positive reaction was also supported by talk of lower interest rate hike plans by the Fed, which should come in at 0.75 percentage points instead of the preliminary range of 1.00 to 1.75.
Despite years of unprecedented bullishness, bitcoin and the cryptocurrency market as a whole remain sensitive to macroeconomic conditions and the situation in the broader financial markets.
There are a number of factors that could weigh on the price of BTC in the future.