Bitcoins Surge to $58K: Can Retail Optimism Reverse the Markets Downturn?
Bitcoin has regained the $58,000 mark today, thus revitalizing the hope of retail traders who are witnessing a shift towards a more positive market sentiment. Based on Santiment data, the wallets with less than 1 BTC now account for the largest share of Bitcoins supply in seven months.
For Bitcoin to return to its all-time highs, the perfect situation would be to have a fall of <1 BTC holders, a continuous rise in the number of 1-100 BTC holders, and a strong accumulation of the holders with over 100 BTC.
Macro Economic Pressures on Bitcoin
On the other hand, the new data from IntotheBlock indicates a turn in sentiment. A few months ago, Bitcoins future looked very positive, and new highs were expected. Nevertheless, with the current macroeconomic situation and a slowdown in the crypto adoption, there is a slight note of caution.
Currently, Bitcoin price is under the weather, with a distinct lack of upward movement. While the market was once full of bright rally hopes, it now struggles with uncertainty as retail and institutional interests both decrease.
The broader macroeconomic sphere is one such environmental factor that is adding to this uncertainty. There are clouds of a possible recession on the horizon, with rate cuts expected at a later stage that could help the risk assets, but these will also be of a very delayed effect. The fact that this macro pressure still exists in the background is the major reason for the markets negative attitude.
Cryptocurrency interest has been considerably declining. The search trends show a decline, not at the historic lows, thus a drop from earlier enthusiasm. The rise of Coinbases application in the rankings is a clear indication of this cooling trend, along with the reduced user engagement. It appears that there is a greater decline in crypto interest in the general community, even though there are arguments about Coinbases market dominance.
The on-chain metrics data is in line with these findings. The number of new Bitcoin addresses still remains to be low and this is a clear indication that there are not many new players joining the market. The initial ballistics that came at the start of the year is over, and this is evidenced by the declining demand.
In reference to historical Bitcoin halving cycles, this current decline could be a standard post-halving dip which has been seen before. The markets present conduct is reminiscent of 2019, a time of a slowdown after a local peak which resulted in a long period of consolidation before finally the bullish trends started.
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Read more: https://www.tronweekly.com/bitcoins-surge-to-58k-retail-optimism-reverse/
Text source: TronWeekly
