With Bitcoin trading above the US$48,000 zone, an interesting movement has been observed, according to recent analyzes by Santiment, a renowned analysis company in the sector. As the global cryptocurrency market experiences a remarkable recovery phase, special attention is turning to altcoins, which appear to be at a critical crossroads.
According to Santiment, there has been a significant spike in interest in altcoins, revealed by the abrupt increase in mentions of the terms “alt”, “altcoins” and “altcoin” in social media conversations, especially in the last week. This trend suggests a growing exuberance among traders, which could signal a warning sign for attentive investors.
“As total cryptocurrency market caps soared this week (+5.9%) and volume soared (+65.4% from the previous week), interest in altcoins increased. When this occurs while prices are rising, it can be a sign of greed,” explained Santiment.
🪙 As #crypto total market caps have rocketed upward this week (+5.9%) and volume has soared (+65.4% vs. previous week), #altcoin interest has risen. When this occurs while prices rise, it can be a greed sign. Monitor the crowd hype by platform here! 👇https://t.co/Gq5MpCCYzf pic.twitter.com/a1D3IhTdrX
— Santiment (@santimentfeed) February 9, 2024
Furthermore, the analysis points out that the cryptoactive market has followed an upward trend since October, a period in which both Bitcoin and altcoins began to show significant appreciation. With the market showing signs of greed, Santiment warns of the possibility of a period of correction for Bitcoin and altcoins.
The 13% rise in Bitcoin’s price over the past week has led traders to speculate several new support and resistance milestones, with $50,000 being widely expected. Ironically, as these price levels were breached, altcoins flipped the script in the early hours of the weekend as the crowd became overly focused on the price of BTC,” the company elaborates on market behavior.
This bull cycle, which began in October, has been characterized by an isolated Bitcoin pump, followed by the redistribution of profits into altcoins and, eventually, a more drastic pullback. Santiment advises investors to monitor how the crowd responds to these dynamics, especially regarding interest in speculative altcoins, as a third pullback phase could quickly occur if the pattern repeats.
The views and opinions expressed by the author, or anyone mentioned in this article, are for informational purposes only and do not constitute financial, investment or other advice. Investing in or trading cryptocurrencies carries a risk of financial loss.