In the ever-changing world of cryptocurrency, the latest buzz isn’t just about skyrocketing prices. It’s also about potential warning signs flashing in the market. According to a recent report from leading crypto analysis firm Santiment, there are indications that altcoins may be preparing for a corrective move. This raises concerns among both investors and traders.
Santiment warns for altcoins
The predictions Santiment shared on the social media platform X were critical. Because it underlines a significant increase in interest in altcoins in the last few days. Moreover, this coincides with a widespread rise in the market. Terms such as “alt”, “altcoins” and “altcoin” experienced a sudden rise towards the end of the week on social media. This indicates a growing sense of enthusiasm among traders. The firm highlighted the correlation between the increase in altcoin interest and the overall upward trend in crypto market cap and trading volume.
The total market value of cryptocurrencies increased compared to the previous week. As it witnessed a significant increase of 5.9% along with a staggering 65.4% increase in trading volume. Meanwhile, interest in alternative crypto assets, namely altcoins, has simultaneously increased. However, Santiment warned that such a scenario, where open interest in altcoins rises during rising prices, usually indicates a phase of greed in the market.
There is also enthusiasm in Bitcoin
The bullish sentiment is not limited to altcoins. Santiment’s analysis shows that the broader crypto markets have been experiencing a bullish wave since October, marked by significant price gains in both Bitcoin (BTC) and altcoins. But amid the current euphoria, the firm warns of a potential pullback looming on the horizon for both Bitcoin and altcoins. Bitcoin’s impressive price increase of over 13% last week has fueled speculation among traders.
Many focused on the coveted $50,000 milestone. However, Santiment points out an interesting trend in which altcoins are quickly gaining attention as Bitcoin catches its eye and approaches new price milestones. This behavior, observed throughout the bull cycle that begins in October and continues, includes typical events. First of all, there is an increase in Bitcoin. Then traders flock to altcoins, Bitcoin pulls back, and the altcoin season comes to an abrupt end.
Be especially careful on weekends
As market dynamics continue to evolve, Santiment wants investors to watch, especially on weekends. He advises them to be careful to monitor how they respond to the ongoing cycle. The firm recommends paying close attention to any increase in open interest levels in speculative altcoins. Because this can signal that the next phase in the market cycle is approaching.
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