Crypto storms back, and it might be because traders are closing their short positions

The crypto markets came storming back earlier this week and the rally continues with all major cryptos in the green over the last 24-hours, according to data compiled by The Block. 

Bitcoin, the largest digital currency, picked up 6.7% and at last check was trading at $3,737. Ripple's XRP was up 11%, whereas Bitcoin cash was up 28%. It's not clear exactly what is behind bitcoin's move upwards, but some of the gains follow news that Tether's stablecoin USDT appears to be fully collateralized, as per Bloomberg News. 

Mati Greenspan, a senior markets analyst at eToro, said the rally might be the result of traders closing short positions. He said: "The recent crypto rally can only be explained as a short covering rally. People are looking to reduce their exposure and closing out high risk sell positions before the holidays. Closing a short sell position creates upward pressure on prices. Evidence: BCH is up the most."