Santiment, a leading on-chain data and social analytics company, shared critical data on the current state of the cryptocurrency market and the conditions under which a potential uptrend might occur in the coming summer months.
Santiment analyst Brian Quinlivan examined investor sentiment and profitability rates in Bitcoin and leading altcoins.
Bitcoin, after reaching $81,000 two weeks ago, has been consolidating around the $77,000 mark in recent days. According to Santiment data, the overall bullish sentiment in the market (bull/bearish ratio) is hovering around an average of 1.35. This indicates that there is neither excessive fear nor excessive excitement (FOMO) in the market.
The 30-day MVRV (Market Value to Realized Value) metric is at +5%. This indicates that the risk for short-term buyers is slightly higher than average due to the 16-17% increase since the beginning of April.
The 365-day MVRV is at -16%. This means that the average investor who traded in the last year is still at a loss. The analyst argues that for those planning to hold long-term investments (HODL), these levels historically correspond to periods of “accumulating energy while the market is vibrant.”
According to the analyst, the biggest obstacle to a summer rally is whale activity. Large wallets holding between 10 and 10,000 BTC have sold a total of 30,870 Bitcoin since the local peak on April 24th. According to Santiment, a strong rally in the summer months depends on these whales returning to accumulation mode.
The correlation between the cryptocurrency market and the US stock market (S&P 500) remains strong. While the S&P 500 index experienced a slight correction after hitting a new record high in mid-May, it is showing signs of recovery towards its peak. Bitcoin suffered a sharp drop over the weekend while traditional markets were closed. According to Santiment analysts, if the S&P 500 maintains its strength, Bitcoin is expected to launch an upward move to close the gap.
*This is not investment advice.
Continue Reading: What Does It Take for an Exciting Summer Rally in Bitcoin? Experts Explain the Key Factor
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Author: NixCoin
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