Bitcoin has made a comeback over the past week, rising by 5%. This has led to the most optimistic sentiment among investors in the past six weeks.
Positive Social Sentiment
According to the latest analysis shared by Santiment, the week started positively for the crypto market, with Bitcoin reaching $88,500 for the first time in 17 days. Ethereum also saw a surge as it surpassed $2,100 for the first time in 14 days. Data from the Santiment platform shows that positive social media comments have increased, indicating greater optimism among market participants.
Cyclical On-Chain Metrics
Despite the price appreciation, the Bitcoin IFP (Inflow-Flow Position) metric continues to flash bearish signals, with a value of 696k, significantly below the 90-day simple moving average of 794K. This suggests no immediate trend reversal to the upside. The Bitcoin CQ Bull & Bear Market Cycle Indicator remains bearish as well. Historically, when the MVRV (Market-Value-to-Realized-Value) score is below its 365-day moving average (SMA365), it signals increased selling pressure. The NUPL (Net Unrealized Profit/Loss) metric is still below its SMA365 level, indicating potential loss of upward trend momentum.
Potential Outlook
While these metrics suggest a period of short-to-mid-term turbulence, none indicate that Bitcoin has reached an overheated cycle top. CryptoQuant analysis suggests that the current bearish signals could be linked to macroeconomic conditions similar to last year’s market environment. Once these macro pressures ease, Bitcoin is expected to recover, but the market must wait and see if history repeats itself.
Despite short-term fluctuations in on-chain metrics, investor and market participant optimism remains high, indicating potential further growth for Bitcoin and other cryptocurrencies.
