Think Bitcoin Bottomed? Santiment Data Says Think Again

Just a few days after Bitcoin’s BTC $86 972 24h volatility: 0.2% Market cap: $1.74 T Vol. 24h: $63.09 B dip to the $80,000 mark and reclaiming $88,000, bullish voices are calling it a bottom.

New analysis from Santiment, however, shows that the shaky sentiment, weak on-chain activity, and cautious market data may mean the real floor has not yet been found.

On Nov. 21, the BTC price fell to a local low of $80,659, but the asset soon gained momentum and touched $89,000 on Nov. 25. Following the rebound, the crypto community started calling it the market bottom, according to an analysis by Santiment.

The market intelligence platform warns that the terms “bull market,” “bear market,” “topped,” or “bottomed” are often misused, as they depend a lot on who’s speaking and what timeframe is meant.

Historically, major reversals tend to happen when “everyone” expects more pain, not when “everyone” thinks the bottom is hit, Santiment’s analyst wrote.

The Worst Is Yet to Come

Bitcoin is currently trading at $87,700. The global crypto market cap increased by 0.3% in the past 24 hours to $3.02 trillion.

This not only triggered bullish sentiment among investors and traders, but also brought increased longs, according to Santiment.

Currently, the funding rates on crypto exchanges are sitting above zero as traders expect further upside for Bitcoin. Historically, the market moves in the opposite direction of what the crowd expects, the analyst says.

Moreover, Bitcoin’s on-chain activity and network growth are still way below the December 2023 peak, with over 3.3 million new addresses created every week. Currently, only 2.2 million Bitcoin addresses launch per week.

The analyst believes that the “market bottom” narrative may be premature, as the current crypto liquidations also show mixed sentiment. CoinGlass data shows that the 24-hour crypto liquidations reached $296 million ($141 million longs and $155 million shorts).

The small long/short ratio hints at lower price volatility, but the nearly $300 million liquidation is proof that traders are uncertain of where the market is headed.

In addition, spot BTC exchange-traded funds in the US recorded a net outflow of $3.57 billion in November so far. In simple terms, institutional sentiment remains bearish despite the massive “bottom” calls on social platforms.

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