Bitcoin investors and traders always try to perfectly grasp market trends, but not everyone can do it. Why? Understanding and interpreting market sentiment. While there are many indicators that help predict trends, most indicators are lagging, which is why they are called lagging indicators. Let's explore the possibility of Bitcoin reaching $110,000.
Explore Bitcoin charts
Before we discuss sentiment, let's first take a look at the current state of Bitcoin.
At the time of writing, Bitcoin is trading at $98,268, having only risen 0.08% compared to the past 24 hours. A few hours ago, the price briefly rose to $99,950, but the 100 moving average pushed it back. The current support level is MA 200. This is also the area where BTC faced high resistance previously, so it will now serve as a support level.
It's worth noting the RSI, currently at 53.60, and it continues to decline as prices fall. Today's trading volume has also dropped by 17.90%. Although the Fear and Greed Index records as 79, which is extreme greed, market sentiment remains bearish.
Market sentiment
Market intelligence platform Santiment shared profound insights in its X post. It described how Bitcoin is fighting against market sentiment. On December 15, social media was flooded with speculation that BTC would reach $110,000, but its peak was $108,000, disappointing the market.
The same thing happened when the price of cryptocurrency was $104,000, with some claiming it would reach $110,000, but then it fell back.
If we analyze the historical trends of Bitcoin and compare them with market sentiment, the direction of events is contrary to what major markets claim. When the market is filled with extreme bearish sentiment, Bitcoin suddenly surges, and vice versa.
As people become super bullish again and market sentiment turns greedy, we should expect prices to fall rather than rise. Once people no longer expect the market to rise, it will shock them again.
Bitcoin's dominance and exchange reserves
Bitcoin's market dominance is 58.43%. This means that investors hold more Bitcoin than other cryptocurrencies. Historically, whenever BTC's dominance falls below this point, the price of BTC tends to fall as well, so it can be said that this specific area is a support region. Currently, we can see that the price is declining, but dominance is rising, which means capital will soon begin to flow out of altcoins and into Bitcoin. However, before that, the price must adjust and form bearish market sentiment.
BTC exchange reserve data shows that reserves have been declining since February 2024, while prices have been rising. This indicator shows the amount of Bitcoin on exchanges. The decline in numbers indicates that people are moving cryptocurrencies from exchanges to cold storage, suggesting that bullish momentum is strengthening.
Looking back over the past few days, we can see that exchange reserves had once increased. This was because when prices exceeded $100,000, whales moved their cryptocurrencies out to sell. Now, the downward curve again suggests an impending bullish trend.
What are the expectations?
From what we have discussed, it should now be clear that market trends are at odds with market sentiment. While we can see that BTC reserves are declining and prices are falling, Bitcoin's market dominance is rising. This clearly indicates that the market is planning to catch traders off guard. People will be bearish and open short positions, which is an opportunity for large and smart traders to extract funds from the market and fill their pockets. None of this is financial advice and should be considered educational content.
So, are you bullish or bearish on Bitcoin?