Analysts expect Bitcoin to fall?
The greed of crypto investors is something to be reckoned with. Recently, Bitcoin reached an all-time high of over $100,000 after Donald Trump won the POTUS race. Shortly after, the Federal Reserve and Jerome Powell started a bloodbath in the crypto space.
To that end, the “buy the dip” chatter has returned to the industry. What can investors expect as the year ends? According to Santiment, social media mentions of “buy the dip” with Bitcoin hitting below the six-figure price level have spiked.
The social dominance score, which reflects “buy the dip” signals on social media, reached 0.061 on December 19. This coincides with Bitcoin stagnating below the $100,000 mark for about 12 hours at the time of writing.
This was the highest social dominance result since April 12, when Bitcoin dropped below $70,000 to just about $67,000, then dropped to about $63,000 the next day.
The “buy the dip” sentiment was almost retested on August 4, when Bitcoin dropped below $60,000 and fell towards $53,000 over the next 24 hours.
According to CoinGecko on-chain data, Bitcoin (BTC) is currently worth $97,503.91, up 0.6% from an hour ago and down 3.6% over the past 24 hours. Bitcoin is down 2.4% today from seven days ago.
Crypto is in an interesting state. Data suggests that search interest for the term “crypto” is still strong, albeit declining. Recent data from Google Trends shows that global searches for “crypto” reached 75 points last week, down 25 points from the peak of 100 points recorded in early December.
Most of those interested in cryptocurrencies are from Saint Helena. Saint Helena is a British Overseas Territory off the coast of Africa in the South Atlantic Ocean. It consists of Saint Helena, Ascension Island, and the Tristan da Cunha archipelago.
Interest is far outpacing what’s happening in the cryptocurrency market. The cryptocurrency market is in a downturn today, with Bitcoin (BTC) falling below $96,000. BTC and ETH ETFs are seeing outflows after a long period of positive performance.
Leading altcoins like Ethereum (ETH) and Solana (SOL) are down, with declines ranging from 3% to 5%. In a surprising development amid the market downturn, both Movement (MOVE) and Zerebro (ZEREBRO) have proven to be standout performers, with MOVE up 30% and Zerebro (ZEREBRO) up 56% in the past 24 hours.
The global cryptocurrency market fell by about 2% to $3.34 trillion, even as trading volume rose by 3.42% to $280 billion. The Fear and Greed Index stands at 62, indicating that market sentiment is leaning toward greed.
Is FOMO coming to an end?
Cryptocurrencies fall after the Federal Reserve cuts interest rates. This may sound like a good thing on the surface, but as part of the cuts, the Fed also said it expects inflation and unemployment to rise more than expected in 2025.
The recent surge in cryptocurrencies began in the wake of the election, fueled by growing speculation that President Donald Trump would start a bull run in the crypto market. While that possibility exists, the notable gains have not been matched by any major shifts in the industry.
There has also been speculation that Bitcoin could be used as a reserve currency or as such by other governments. Federal Reserve Chairman Jerome Powell has been clear that the Fed is not allowed to buy Bitcoin, which may have caused some disappointment.
This seems to be a “buy the rumor, sell the news” moment in investing, where investors are disappointed when results or news come out, even if it’s something as obvious as the Fed not buying Bitcoin.