Key Points
- Bitcoin’s weighted sentiment remains negative, hinting at a possible price decline below $66,000.
- Historical precedents suggest Bitcoin’s price often moves contrary to crowd expectation.
Bitcoin’s [BTC] extended weekly loss of 4% continues the bearish trend, as per data from Santiment.
The negative sentiment surrounding Bitcoin has been ongoing for the past three weeks, beginning on 14th March when the coin’s price fell from its all-time high of $73,750.
Market Expectations and Bitcoin’s Price
Santiment’s historical data suggests that Bitcoin’s price often moves in the opposite direction of the market’s expectation. When the market expects a continued rally, Bitcoin’s price retraces. Conversely, when the market sentiment is poor and expects further downside, Bitcoin’s price has been known to initiate an uptrend.
On 4th April, Bitcoin’s price briefly rallied above the $69,000 price level before retracting to the $66,500 region. New resistance formed at $69,000, and on-chain data suggests the possibility of a further decline in Bitcoin’s value in the short term.
On-Chain Indicators and Price Decline
The coin’s taker buy-sell ratio, a metric that measures the ratio between the buy volume and sell volume in an asset’s futures market, fell below the zero line on 8th March. This fall foreshadowed the price decline that started on 14th March.
Since then, the value of Bitcoin’s taker buy-sell ratio has been less than 1, indicating more sellers than buyers among those executing immediate trades in the Bitcoin market. This trend is expected to continue as long as sentiment remains bearish, putting downward pressure on the coin’s price.
Additionally, a recent report by CryptoQuant analyst Tugbachain found that Bitcoin’s NVT Golden Cross closed March flashing a sell signal. This indicator compares the 30-day moving average of the coin’s network value to transactions (NVT) ratio with its 10-day moving average.
When the value is above 2.2, it is taken as a signal to enter short positions. Tugbachain noted that at the end of March, with the Bitcoin price around $71,000, the NVT value reaching ‘3.17’ levels served as an indicator of reaching a local peak.
For Bitcoin’s price prediction 2024-25, click here.
