- Bearish sentiment in the crypto sector increased.
- Bitcoin and Ethereum witnessed a decline in the number of profitable and short-term holders.
AMBCrypto’s analysis of Santiment’s data showed that bearish sentiment in the crypto sector was on the rise.
Bears jump forward
According to the data, there has been a dramatic decline in bullish sentiment on online forums such as X, Reddit, Telegram, 4Chan and BitcoinTalk.
Traders have seemingly lost confidence in the markets, with bullish calls dropping significantly. Interestingly, bearish calls have also declined, but at a much slower pace.
Fearful investors who were previously bullish could now be more inclined to sell their holdings, driving down Bitcoin prices [BTC] and ether [ETH] short-term. This could trigger a domino effect as others panic, further exacerbating the decline.
However, the significant drop in bullish calls could also signal a capitulation, with investors having exhausted their hopes and being forced to sell.
Selling pressure could eventually subside, leading to a period of consolidation and possibly a market bottom for BTC and ETH.
Source:
A tale of two keepers
At the time of writing, BTC was trading at $61,361.69 and the price was down 0.67% over the past 24 hours.
During this period, the MVRV ratio for BTC dropped significantly. A decline in the MVRV ratio implied that in addition to the price, the profitability of most holders had also declined.
In combination with this, BTC’s Long/Short difference had also decreased. A declining Long/Short ratio indicated that the number of long-term holders had decreased compared to the number of short-term holders flooding the market.
These short-term holders are unreliable and can be significantly affected by market fluctuations. If volatility continues, there could be more downward pressure on BTC in the long term.
Source: Santiment
When combined with BTC, ETH could also face significant selling pressure. This is due to the fact that Ethereum and Bitcoin are highly correlated. IntotheBlock’s data showed that the correlation between both tokens was 0.86 at the time of writing.
Read Ethereum (ETH) Price Prediction 2024-25
Price-wise, ETH was trading at $3,432.61 and had grown by 1.37% over the past 24 hours.
The MVRV ratio and Long/Short difference for ETH had also decreased, implying a decisive number of profitable addresses and short-term holders.
Source; Santiment