Investing.com -- Bitcoin pared some of its gains Tuesday but remained on track to exit correction territory following a sharp two-day rally amid signs of robust demand for the popular crypto.
Bitcoin rose 5.29% to $12,530, down slightly from its high today of $12,772. The popular crypto is just shy of exiting correction territory, down about 10% from its most recent peak of $13,929. The level was reached on June 26.
The rally in bitcoin followed from a sudden intraday rally a day earlier, above resistance of $11,500 to test the $12,000 level. Many in the crypto community were at a loss as to the reason for the surge.
Institutional demand for bitcoin has been strong as investors appear willing to buy the dips, boosting the popular crypto’s market cap, often used to gauge demand, to $221 billion, up 5% from a day earlier.
Ongoing institutional demand could be the key for the next breakout higher, said Edward Moya, chief market strategist at Oanda Corp. in New York.
“Bitcoin looks like it could be coiling for a big breakout as institutional interest for blockchain technology shows no signs of slowing down," said Moya. “The bubble-like gains this time are driven on solid institutional interest and while security is still a big risk, it appears Bitcoin has overcome many of its initial growing pains."
Other cryptos followed bitcoin higher, with XRP falling 1.15% to $0.39357, Ethereum up 1.14% to $310.85 and Litecoin sliding 1.04% to $119.20.