The crypto markets decided to serve up some gains with the turkey this year. Major cryptocurrencies rallied on Wednesday as investors shifted into risk-on mode ahead of Thanksgiving festivities, mirroring a broad stock market rally.

The Holiday Rally Takes Shape

Bitcoin (BTC) pushed to an intraday high of $90,819, extending its Thanksgiving week rebound and giving bulls something to be thankful for. The world's largest cryptocurrency continues its recovery from the recent dip that had some traders questioning whether the party was over.

Ethereum (ETH) managed to break back through the psychologically important $3,000 level after spending a week below it, though trading volumes remained relatively light. XRP and Dogecoin (DOGE) posted more modest gains of 1.42% and 1.58% respectively over the 24-hour period.

Bitcoin's market dominance slipped below 58%, while Ethereum's share of the total crypto market cap fell to 11.8%. Over in the equity markets, Strategy Inc. (MSTR), the Bitcoin treasury company formerly known as MicroStrategy, climbed 2% during regular trading hours.

The derivatives markets told an interesting story. Total cryptocurrency liquidations hit $270 million in the last 24 hours according to Coinglass data, with a hefty $192 million of that coming from bearish short positions getting wiped out. That's what happens when you bet against crypto right before a rally.

Bitcoin's open interest increased 2.38% to $61 billion over the same period. More than 67% of Binance's top traders—defined as the top 20% of users by margin balance—were positioned long on the leading cryptocurrency. Apparently the smart money is betting on more upside.

Despite the green candles, the Crypto Fear & Greed Index still showed "Extreme Fear" sentiment persisting in the market. Sometimes fear and gains can coexist in this strange world we call crypto.

Top Performers and Market Overview

While the major coins posted solid gains, some smaller cap cryptocurrencies absolutely exploded higher.

The global cryptocurrency market capitalization stood at $3.1 trillion, growing 2.58% in the last 24 hours. Not too shabby for a Wednesday before a holiday.

Stocks Join the Party

The stock market extended its winning streak on Wednesday, with all major indices posting gains. The Dow Jones Industrial Average rallied 314.67 points, or 0.67%, to close at 47,427.12. The S&P 500 gained 0.69% to settle at 6,812.61, while the tech-heavy Nasdaq Composite rose 0.82% to close at 23,214.69.

Fresh labor market data helped boost sentiment across risk assets. Initial jobless claims for the week ending November 22 came in at 216,000, down from 222,000 the previous week and beating expectations of 225,000. A strong labor market without being too hot is the Goldilocks scenario everyone wants right now.

Expectations for a December rate cut from the Federal Reserve remain elevated, with traders pricing in an 84% probability of a 25 basis point reduction according to the CME FedWatch tool. Both the New York Stock Exchange and Nasdaq will be closed Thursday for Thanksgiving, so traders get a brief pause from the action.

Did Bitcoin Just Find Its Bottom?

The big question on everyone's mind is whether Bitcoin's recent low represents a cycle bottom or just a pit stop on the way down. Analysts are split, but some interesting indicators are emerging.

Widely followed cryptocurrency analyst Ali Martinez highlighted that the Puell Multiple currently stands at 0.67. This metric tracks Bitcoin miners' daily revenue against their yearly average, and historically when it has dropped below 0.50, it has marked Bitcoin cycle bottoms. At 0.67, we're not quite there yet, suggesting there could still be room for downside if history repeats.

Michaël van de Poppe, another prominent cryptocurrency market commentator, offered a different take. He noted that Bitcoin is holding a crucial level and suggested that a break above $92,000 by month-end could confirm that the recent low below $80,000 was indeed the cycle bottom. That's the level to watch if you're trying to figure out whether to buy the dip or brace for more turbulence.

For now, crypto holders can enjoy their Thanksgiving gains and hope the rally continues into the holiday weekend. Whether this marks the beginning of another leg up or just a brief respite before more volatility remains to be seen.