Will ‘Bitcoin catharsis’ end soon? This alpha factor might be key
The current bear market calls for the skills of ‘Tsujigiri.’ Well, if you are an investor or a trader thinking ‘Life’s but a walking shadow,’ then acquaint thyself with celebrated American investor Jim Rogers’ belief –
“Bottoms in the investment world don’t end with four-year lows, they end with 10-15 year lows.”
Now, this quote might feel like a minor myocardial infarction. However, know that Bitcoin holders needn’t really worry as positive sentiments are in the king coin’s territory. It’s important to note here that sentiments rule the trading world.
And, you ask, how can someone measure that. Well, the ‘social dominance’ on-chain metric can reveal a lot about traders’ stress per unit of profit and the overall sentiment across the market.
Interestingly enough, for most of the last two years, the market has seen BTC’s social dominance value well below 20% as the altcoin craze was in full swing. But, surprisingly, Bitcoin’s social dominance is above 25% this week.
It is indicative of the fact that the crypto-crowd is having a “healthy” outlook on Bitcoin in general. Moreover, it clearly goes on to reflect that over one-quarter of all discussions in crypto-forums have been related to the king coin, rather than altcoins or stablecoins.
Source: Santiment
At this point, it wouldn’t be a fool’s question to ask how positional traders can benefit from this metric’s reading. One doesn’t need to ‘go figure!’ Taking a look at weighted sentiment should suffice.
The negative sentiment post 6 June has recovered. It currently is at the -0.069 mark. Its chances of moving to the positive zone look nil at the moment. Positional traders willing to go short can capitalize on this opportunity.
Source: Santiment
However, traders seeking validation
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