Crypto Rally or Short Squeeze? (BTC-USD)

Over the past weekend, Bitcoin (BTC-USD) and the rest of the cryptocurrency market arose from a downtrend that began nearly 3 months ago.

Will the rally last? Or is it just more senseless volatility?

LikeFolio data shows that the number of individuals talking about actively trading crypto has pulled back alongside the market but remains significantly elevated vs. the prior year: +395% on a 7-day moving average.

This appears promising from the standpoint of longer-term adoption...However, it also points to the possibility that the recent price action seen is just a short squeeze.

Crypto traders are notorious for their usage of leverage. The volatility introduced by such borrowing has inspired massive moves in the past, both higher and lower.

It stands to reason that a lot of shorts got cleaned out in the past few days and their covering certainly helped drive the price higher. It remains to be seen whether the bulls are really back in control.