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Sentiment platform Crypto Santiment warns traders against assuming that the market has already hit its bottom, warning that widespread confidence in a fund often precedes further declines.
Key tips:
- Santiment warns that the increase in “the fund is in” the sentiment often signals more downside, noting that Bitcoin chatter has become increasingly fearful.
- Bitcoin’s social dominance has risen above 40% as positive sentiment hits a one-month low.
- Amid $1.17B in recent ETF flows, Santiment says such flows are historically aligned with market funds.
“Be careful when you see a general consensus forming on a specific price,” he said. said in a report published on Saturdayadding that “real bottoms often form when the majority expect prices to fall further.”
The warning comes after Bitcoin briefly fell below $95,000 on Friday during a broader tech-led selloff.
Santiment: “The worst is over” Chatter Signals More Downside Ahead
Santiment noted an increase in social media chatter saying the worst is over, a sign he believes often points in the opposite direction.
Historically, bottom calls tend to spike when psychological thresholds like Bitcoin falling below $100,000 are breached.
The firm added that Bitcoin’s ratio of positive to negative comments is now at its lowest point in more than a month, with “social dominance” above 40%.
“As the price of Bitcoin has fallen, its social dominance has grown to more than 40%, showing that it is the main topic of a very scary conversation,” the report said.
Some market participants linked the drop to Strategy Chairman Michael Saylor, with mentions of “Saylor” jumping sharply as prices fell.
During an appearance on CNBC, Saylor denied rumors that the company had sold any of its Bitcoins.
Santiment also argued that recent Bitcoin ETF spot flows, which totaled $1.17 billion in the last three trading days, could ultimately prove bullish.
“Large ETF flows often marked local price peaks, while significant flows coincided with market lows, suggesting panic selling,” the firm said. Thursday alone saw $866 million in net inflows, the second-worst day on record.
The deterioration in sentiment pushed the Crypto Fear & Greed Index to an “Extreme Fear” score of 10, the lowest since February 27.
Bitcoin settles below $96K, but analysts say this drop looks softer
Bitcoin struggled to regain the level of $96,000 after the sudden fall on Friday, here in similar conditions seen earlier in the year when the asset fell from $102,000 to $84,000.
Still, some analysts see the current environment as less severe than previous downturns.
Bitwise’s head of European research Andre Dragosh said the situation is “not so depressing” compared to previous corrections, adding that Bitwise’s sentiment index shows a “positive divergence”.
Broader macro uncertainty continues to weigh on crypto markets. While President Donald Trump recently signed a bill that would end the longest government shutdown in the history of the United States, an event that some traders blame for the high volatility, the attention has now moved on to the Federal Reserve’s next rate decision.
Despite the gloomy sentiment, some analysts see constructive signals on the charts. NorthmanTrader founder Sven Henrich pointed to a “collapsing wedge” and “positive divergence” pattern, calling it “potentially positive” for Bitcoin bulls.
Others note a striking gap between sentiment and fundamentals.
Messari Research Manager “DRXL” he said that in eight years in the industryhe has never seen “such a dissonance between headlines and sentiment,” adding, “Everything we once dreamed of has happened, but somehow it feels … over.”
