Crowd money sentiment shows a strong bullish trend, and we are expecting a recovery after the recent July dip.
According to Santiment’s metrics, retail traders’ current behavior reflects more optimism than previous market dips. Over the past few days, Bitcoin (BTC) and Ethereum (ETH) have experienced significant declines but have since recovered.
Retail traders show resilience
Unlike intelligent money, which often represents the actions of more prominent institutional investors, crowd money measures the behavior of retail traders. Recently, some prominent whale wallets began selling, causing concern.
However, retail traders have shown resilience, accustomed to the cryptocurrency market’s volatility. Current data suggests that retail investors are bullish, anticipating a swift recovery despite the recent downturn. This sentiment, however, could be misleading as market conditions may continue to fluctuate.
If you're considering buying the dip, note that the crowd is anticipating a rebound themselves. Ideally, one of these dramatic dips is met with FUD and panic. Historically, most turnarounds occur immediately after the average traders have given up hope on crypto. pic.twitter.com/6St0yzefnB
— Santiment (@santimentfeed) July 8, 2024
Market sentiment and social media influence
Small-scale traders increasingly use “buy the dip” strategies, aiming for quick recoveries and potential immediate gains. Despite this optimism, social media platforms also host bearish predictions, particularly for BTC, with some expecting further declines to around $40,000.
There are currently 54.09M non-empty Bitcoin wallets on the network, dropping by a net of 566K since June 15th. Patient bulls should be pleased with this, as self-liquidating wallets from impatient non-believers is a sign of FUD-causing bottoms, just like we saw in January. pic.twitter.com/h2jK9YvCf9
— Santiment (@santimentfeed) July 9, 2024
The current price levels for BTC and ETH are met with a mix of skepticism and opportunity. In the short term, the market has rebounded, with some assets seeing gains of over 10% in just 24 hours. This recovery contrasts with the crypto fear and greed index, which recently dipped to 27 points, the lowest since 2022.
Comparing current market conditions to 2022
The market is in a better position now compared to 2022. Significant assets have recovered and are relatively close to their all-time highs. The last time the fear and greed index fell below 30, Solana (SOL) dropped below $10. The current question is whether the market bottom has been reached. BTC recently hit a low of $53,000 and has not revisited that level in the past week. Significant liquidations of BTC traders have already occurred, potentially paving the way for a price increase.
Santiment’s analysis indicates that the recent market crash led to the capitulation of some holders, with their coins shifting to larger whale wallets. Year-old wallets now see slim gains of 1.8%, which Santiment interprets as a potentially bullish signal for a trend reversal, reminiscent of the previous rally above $20,000. During recent market fluctuations, coins sold often ended up in large-scale wallets holding more than 10,000 BTC, benefiting from the market correction.
Bitcoin’s volatility and market health
Bitcoin (BTC) has shown increased volatility, leading to rapid shifts in market sentiment. While the bull cycle has not reached predicted all-time highs, BTC remains healthier than previous cycles. The market has demonstrated resilience, absorbing sales from miners, whales, and government wallets. Additionally, ETF buying has resumed after a period of net outflows.
Fidelity leads the way with $BTC ETF inflowsGrayscale coming in secondFollowed by Ark and BitwiseSmart money buying the #Bitcoin dip pic.twitter.com/qdS5pMJGl7
— Eric | Selected Investments (@SelectedInvests) July 9, 2024
The 2024 market has seen different hype and trading volumes than in 2021. However, it is well-supported by stablecoins, and decentralized finance is helping manage volatility. Retail investor behavior, a key indicator of market health, has yet to reach the frenzy levels of previous cycles.
The current cycle sees more cautious optimism, particularly in ETH prices. ETH recently traded at $3,081.56, recovering quickly after signs of whale wallet sales. Crowd money sentiment for ETH has turned more bearish, while intelligent money remains cautiously optimistic.
The post Crowd Money Sentiment Remains Bullish Amid Market Volatility first appeared on Coinfea.