Bitcoin rally has positively affected most of the crypto market
Bitcoin was trading at a price of $ 47,637 so far, with its market capitalization gaining more than 19% in one week, from $ 710 billion to $ 880 billion. In fact, the price of BTC rose almost 25% in 7 days, with market sentiment rising.
Now, as far as the Bitcoin market is concerned, there is a 10% concentration on large hodlers and that is a good sign for the price hikes. In addition, both active Bitcoin addresses and the exchange offer of stablecoins such as USDT remain high, an encouraging sign that indicates that BTC may recover after a slight retracement or a price correction.
These findings seem to point to an extended price increase until Bitcoin reaches $ 100,000, according to Plan B analyst S2F or S2Fx model.
What’s also worth noting here is that, although Bitcoin has climbed the charts in this booming market, so did names like Cardano and Binance Coin.
Binance Coin’s price has exceeded $ 100 for the first time and tokens like YFI, LINK, DOT, IOTA and MATIC have also doubled in price in recent weeks. In fact, the current situation is positive for cryptocurrencies in general. While the appreciation of altcoins may suggest that the Bitcoin price hike is coming to an end, that hike is different in many ways.
On the contrary, it can be a red flag or cause for concern that meme coins like DOGE are pumping easily. And while traders may be enjoying it while it lasts, this is not a positive sign for rising prices. A price increase beyond rationalization is the first sign of a bubble, and meme coins are proving just that.
While Bitcoin’s perception has changed as large players and payment institutions are buying BTC and planning to support Bitcoin payments, meme coins are bubbles in the making. The metrics associated with weighted social sentiment are in a good position to highlight these concerns. Currently, weighted social sentiment is returning to the levels of early January 2021, with it representing the early stages of euphoria.
After the euphoria, traders who buy now may see more unrealized losses, since altcoins fall faster than they rise during a bullish Bitcoin run. With respect to traders’ confidence, we are in a semi-confident area. This is a more or less neutral territory for the sentiment of traders. The problem with neutral sentiment is that it is easier for the price to fall and the sentiment to move into the negative zone very quickly.
However, it is also important to note that the bullish sentiment is not Bitcoin’s biggest friend and a neutral sentiment may be more beneficial for long-term price hikes. The current bullish run may extend and exceed expectations, unless traders are more optimistic than when the previous ATH was reached. In the present case, since there is a greater likelihood of a prolonged high, this bull run may last long enough to reach a new ATH above the current level.