Bitcoin price made a strong comeback on Friday after witnessing a significant amount of bearish pressure over the past week. On Wednesday, May 1, the major cryptocurrency fell below the $60,000 mark for the first time in almost two months.
On Friday, May 3, the price of BTC recovered above the $60,000 level and rose to $63,000 over the past day. However, the question is: can Bitcoin price stage a sustained rally after this latest rebound?
How long will the BTC price rally last?
In a recent one message on the X platform, Santiment pointed to a shift in investors’ position and sentiment on the Bitcoin price after its recent surge above $62,000. According to the on-chain analytics site, traders on the Binance platform are “moving from liquidated shorts to longs” after the latest price increase.
While this shift in sentiment could signal renewed optimism in the leading cryptocurrency, Santiment sounded a warning bell for enthusiasts eyeing the Bitcoin price and looking to enter the market. The blockchain company said in its post:
To continue the rally, we don’t want FOMO to rise too much higher than what it appears to be now.
Source: Santiment/X
FOMO, or “fear of missing out,” is a phenomenon where investors rush to buy in-demand assets for fear of missing out on potential gains. While it can drive assets higher in the short term, excessive FOMO often results in unsustainable bullish trends and subsequent downturns.
Furthermore, crypto prices tend to move in the opposite direction of public expectations. Therefore, if the majority of traders are betting on a rise in the Bitcoin price, there is a good chance that the value of the cryptocurrency will fall.
Behind the Bitcoin Price Rise
At the time of writing, the Bitcoin price stands at around $62,871, reflecting a substantial 6% increase in the past 24 hours. While the catalyst for this latest Bitcoin rally remains unclear, on-chain data shows that recent whale activity could have driven the bullish momentum.
In a recent one message on X, CryptoQuant CEO and Founder Ki Young Ju revealed that Bitcoin whales acquired 47,000 BTC in one day. Ju also said that while this class of investors may have included ETF-associated addresses, the recent spike in “whale address balances” is not ETF-related.
#Bitcoin whales collected 47K $BTC in the last 24 hours. We are entering a new era. pic.twitter.com/SXgzToN8GU
— Ki Young Ju (@ki_young_ju) May 3, 2024
Bitcoin price fails to hold above $63,000 on the daily timeframe | Source: BTCUSDT chart from TradingView
Featured image from iStock, chart from TradingView
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