Summary: Santiment founder Maksim Balashevich believes that the current sentiment in the cryptocurrency market has not reached a sufficient level of panic, so it cannot be confirmed that the market has bottomed out. He pointed out that the price of Bitcoin may further decline to $75,000, which is about 14.77% of the current price. At the same time, he emphasized the potential impact of the Bank of Japan’s interest rate hike on the price of Bitcoin, and said that excessive optimism in the market may lead to further price decline. In addition, market indicators such as the Crypto Fear & Greed Index and the Altcoin Season Index indicate that the market sentiment is still uneasy, further verifying the view that the market has not yet bottomed out.
TL;DR:
- The current market sentiment is too optimistic and lacks sufficient panic, indicating that the market bottom has not yet arrived.
- Bitcoin may fall to $75,000, with a pullback of about 14.77%.
- The Bank of Japan’s interest rate hike may bring about a similar historical Bitcoin correction, further exacerbating market adjustments.
- The Crypto Fear & Greed index maintains a state of “extreme fear”, indicating that market sentiment remains uneasy.
- The current pullback provides potential opportunities for future buying.
Market sentiment has not yet shown enough panic
According to the analysis of Maksim Balashevich, the founder of Santiment, although there is some optimism in the market, it does not mean that the market has bottomed out. He pointed out that the market usually shows pessimism and fear at the bottom, and the current market sentiment is still too optimistic, which may indicate that the market has not yet bottomed out. Excessive optimism usually leads to further price declines until the market panic begins to intensify and eventually forms a bottom.
Bitcoin may pull back to $75,000
Balashevich predicts that the price of Bitcoin may further decline to $75,000. According to CoinMarketCap data, if Bitcoin falls to the above level, it means a decrease of about 14.77% from the current $88,350. Although some investors in the market are hopeful for a rebound in Bitcoin, Balashevich believes that the excessive optimism of the current market sentiment may cause the price to continue to decline until panic finally drives the market to bottom. In his view, such a pullback is part of the normal market adjustment, rather than a complete collapse of the cryptocurrency market.
The potential impact of the Bank of Japan’s interest rate hike
Balashevich also pointed out that the Bank of Japan recently raised interest rates to 0.75%, the highest level in 30 years. Historically, similar rate hikes have often had a negative impact on Bitcoin prices, usually leading to a 20% pullback. Therefore, Balashevich believes that this rate hike may bring downward pressure on Bitcoin prices and intensify market adjustments. Although there may be panic in the short term, this pullback may also provide investors with a lower entry point.
Market indicators validate lack of panic
Santiment pointed out that although some analysts in the market still hold an optimistic attitude, the key sentiment indicators of the market show opposite signals. Especially the Crypto Fear & Greed index, which has been in the “extreme fear” area since December 14th and scored 20 on December 20th, indicating that the market sentiment is still biased towards pessimism and has not shown enough optimistic signals. Such a mood state usually indicates that the market has not yet bottomed out.
In addition, the Altcoin Season index shows that the “Bitcoin season” is still continuing, indicating that investors still have a high preference for Bitcoin and are more inclined to avoid risks. This indicates that the overall market sentiment is still relatively cautious, and investors’ risk aversion sentiment is relatively strong.
The pullback provides future investment opportunities
Although the market may face more volatility and adjustment in the short term, Balashevich believes that this correction provides investors with a good buying opportunity. He emphasized that although the current market has not yet bottomed out, patient investors can obtain lower entry points through this adjustment, thus obtaining rich returns when the market rebounds in the future. History has shown that after a deep market correction, there are usually strong rebounds and growth opportunities. Therefore, investors who can withstand short-term fluctuations and make long-term investment plans may obtain considerable returns in the future.
Conclusion
Santiment’s analysis shows that although market sentiment has rebounded, it has not shown enough panic to confirm that the market has bottomed out. Bitcoin may continue to fall to $75,000, providing investors with a lower entry point. Although market sentiment remains uneasy, based on historical experience, this correction may provide good investment opportunities for future gains. Investors should remain vigilant and patiently wait for further market adjustments in order to seize potential investment opportunities when the market rebounds.
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