Bitcoin Triumphs Over $41,000, But Here’s What Could Prevent $50,000
December 04 2023 - 7:00AM
NEWSBTC
Bitcoin has broken past the $41,000 level during the past day, but
FOMO could be the number one danger to a further surge towards
$50,000. Bitcoin Social Dominance Has Spiked Following The Rally
According to data from the on-chain analytics firm Santiment, signs
of euphoria have appeared among Bitcoin traders following the
latest climb in the asset’s price. The main indicator of interest
here is the “social dominance,’ which is based on another metric
called the “social volume.” This latter indicator basically tells
us about the amount of discussion related to a given topic that is
happening on the major social media platforms right now. The metric
tracks this by going through each post/thread on these platforms to
see if they are making mentions of the topic or not. However,
rather than counting the number of mentions themselves, it
separates the posts and counts the total number of them instead.
Related Reading: The Big Move: Crypto Pundit Predicts When Bitcoin
Will Reach A New ATH Because of this approach, a more organic
overview of the market becomes apparent, as the indicator will only
spike when discussions are happening across social media, rather
than inside just one or two large threads. The social dominance
compares this social volume of any given coin against that of the
top 100 cryptocurrencies combined. Thus, whenever this indicator
shoots up, it means that the mindshare related to the asset is
going up among social media users. Now, here is a chart that shows
the trend in both the Bitcoin social volume and social dominance
over the past year: The value of the metric seems to have
registered a large spike during the past day | Source: Santiment on
X As displayed in the above graph, the Bitcoin social dominance
observed a huge increase when the Bitcoin price broke above $40,000
during the past day. This implies that users shifted focus toward
BTC from the other coins after this rally. While some attention is
healthy (it’s even required, otherwise the move would become
unsustainable), too much hype has often not turned out to be
favorable for the cryptocurrency in the past. An example of this is
clearly visible in the chart, where the BTC rally hit its brakes
back in March of this year after the social volume and social
dominance both registered significant spikes. Going by this, the
current even higher values of social dominance could be a worrying
sign for the asset’s hopes of rallying toward the $50,000 mark.
Though, so far, BTC has still been able to continue its climb
despite this development, as it has now broken past the $41,000
barrier as well. Related Reading: Bitcoin Price Blasts Past
$41,500: Here Are The Reasons In the end, it comes down to whether
the discussions have a bullish or a bearish view. More of the
latter would provide better chances for the rally to continue. As
Santiment explains, “FUD & FOMO toward the ongoing ETF
confirmation dates will dictate whether $50,000 arrives sooner
rather than later.” BTC Price It would appear that Bitcoin isn’t
done with its surge yet as the coin has now risen above $41,800,
inching closer to $42,000. BTC has enjoyed some sharp uptrend
during the past day | Source: BTCUSD on TradingView Featured image
from Kanchanara on Unsplash.com, charts from TradingView.com,
Santiment.net
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