Crypto merchants are displaying peak confidence in shopping for the most recent market dip, however Santiment knowledge suggests this optimism could also be a prelude to extra worth drops.
In keeping with the on-chain analytics platform, discussions about “shopping for the dip” have reached their highest stage in seven months, pushed by Bitcoin’s plunge under $80,000.
In search of a True Backside
Santiment’s evaluation revealed a pointy enhance in mentions of “shopping for the dip” throughout platforms like X, Reddit, Telegram, and BitcoinTalk, which all have thriving crypto communities.
The sentiment tracker recorded its highest stage of dip-buying discussions between February 25 and February 26, coinciding with a 27% drop in BTC’s worth.
Nonetheless, specialists have urged warning. In keeping with the analytics agency, markets have traditionally moved towards crowd expectations. It signifies that an actual restoration could solely start when dip-buying sentiment cools down, which might point out that enthusiasm amongst retail merchants has largely pale.
Subsequently, the platform suggested ready for the neighborhood’s optimism to die down earlier than contemplating a market entry, as that may sign a real shopping for alternative.
Additional exacerbating the state of affairs, the Bitcoin Worry & Greed Index lately plunged to 10, its lowest studying since June 2022, indicating excessive worry amongst buyers.
Whereas up to now, such lows often got here earlier than a market restoration, some analysts, together with BitMEX co-founder Arthur Hayes, have warned that the primary cryptocurrency may drop to the $70,000 stage earlier than stabilizing.
In a latest put up on X, the crypto investor predicted BTC’s fall under $80,000, suggesting it could occur over the weekend of February 28. “I believe we’ve yet one more violent wave down under $80k, most certainly over the weekend, then crickets for some time,” the Maelstrom CIO famous.
Market Turmoil Continues
On the time of this writing, the broader crypto market had hemorrhaged almost 9% of its capitalization within the final 24 hours. Bitcoin is down 7.4% in the identical interval and has shed greater than 19% from its worth over the previous seven days.
Solana, XRP, and Ethereum fared worse at the moment. SOL is down 27% over one week, XRP has dipped by greater than 24%, whereas ETH misplaced 23.1% of its worth.
Many causes have been put ahead to clarify this decline, with some observers pointing at macroeconomic issues, together with U.S. President Donald Trump’s tariff announcement on Canada, Mexico, and China, in addition to his menace to take related measures towards the European Union.
As merchants navigate this turbulent market, one factor is evident: extreme optimism won’t be the bullish sign they might have hoped for.
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