Retail Frenzy as Bitcoin Hits $94K: Santiment Warns of FOMO — Is a Correction Looming?

The recent surge in Bitcoin above $94,000 on Wednesday is sparking a new wave of excitement among retail traders. However, even as $ 100,000 predictions flooded social media and investor optimism soared, seasoned analysts are urging caution.

In a post on X (formerly Twitter), Santiment highlighted the dangers of this retail-driven enthusiasm. “$100K could very likely arrive in the near future,” the firm wrote, “but it typically won’t happen till the emojis calm.”

The post was a quote from a message by analyst Maksim, who noted a rise in bold Bitcoin price predictions, asking, “$100K by week’s end? Not so fast. Patience > hype.”

Data from analytics firm Santiment shows a clear uptick in retail-driven FOMO, which historically coincides with market tops, raising the possibility of an imminent correction.

Bitcoin Retail FOMO Meets Whale Accumulation

Bitcoin’s sudden push above $94,200 has sparked intense interest from retail traders. According to Santiment, this FOMO behavior is a common characteristic seen near local market tops, where inexperienced traders often buy into hype.

This crowd-driven sentiment is particularly volatile, especially when it occurs after a relatively quiet period.

In recent weeks, retail interest had declined amid macroeconomic headwinds. The resurgence, then, marks a significant shift in sentiment.

However, this renewed retail presence is not the only force at play. Data from Santiment also revealed that major holders have quietly accumulated vast amounts of Bitcoin over the past month.

Wallets holding between 10 and 10,000 BTC have added over 19,255 BTC in a short span, and since March 22, have added more than 50,000 BTC in total. These whales and sharks now collectively hold over 67% of the total Bitcoin supply.

This level of accumulation is usually a precursor to major rallies, as such investors are typically early movers with high conviction.

The fact that this activity coincided with Bitcoin’s 11.2% rally from April 21 to April 25 adds further weight to the bullish outlook.

Adding to the optimism is data from CryptoQuant, which showed that the 100-day moving average of Bitcoin netflows to exchanges has dropped to its lowest point since February 2023.

This marks the largest BTC outflow from exchanges in over two years, indicating that investors are increasingly moving their assets into long-term storage.

These outflows typically reflect investor confidence in holding, rather than selling, BTC.

Historically, such patterns often precede price appreciation. CryptoQuant noted that this re-accumulation behavior mirrors earlier bullish cycles, implying that investors may be gearing up for a prolonged rally.

Greed Grows, But So Does Caution

While retail optimism and whale accumulation fuel upward momentum, the market is also seeing warning signs that suggest a potential near-term pullback.

Chief among them is the Fear & Greed Index, which soared to 72 on April 23, marking its highest level in over two months.

As of April 25, the index has cooled slightly to 60, but remains in “Greed” territory.

This shift in sentiment follows a strong run for Bitcoin, which is currently trading at around $93,289.

Technical indicators support a bullish stance in the short term. The relative strength index (RSI) is at 66.10, approaching overbought levels, but still within range for upward movement.

Bollinger Bands are widening, signaling increased volatility. Resistance lies at $95,091.87, with key support at $87,724.

However, not all analysts are convinced. Markus Thielen from 10x Research expressed doubts, noting that their stablecoin minting indicator has yet to show strong activity, a signal that often confirms lasting market rallies.

Despite the caution, some analysts remain bullish. Michaël van de Poppe of MN Trading Capital believes that continued buying pressure could drive Bitcoin to a new all-time high.

Supporting this view is the strong institutional appetite. U.S. spot Bitcoin ETFs have recorded $2.68 billion in net inflows over the past week, making it their third-best week since launching in January. ETF inflows remain one of the strongest indicators of long-term market strength.

According to ARK Invest’s latest report, Bitcoin is on track to reach price levels as high as $2.4 million by 2030 under its most optimistic scenario.

Even the base-case scenario, which assumes moderate adoption, predicts that BTC will reach $300,000 in the coming years.

Meanwhile, Bitcoin’s dominance remains firmly in control at 64.29%, as altcoins continue to lag.

CoinMarketCap’s altcoin season index sits at a meager 17 out of 100, further affirming Bitcoin’s lead in investor interest.

Though Bitcoin continues to trade above $92,000 and holds above the 100-hour simple moving average, it has struggled to clear the $94,500 resistance level.

A connecting bullish trend line at $93,100 may act as support if the price experiences a short-term dip.

A move above $94,500 could trigger another leg up, but failure to break that resistance may lead to a correction toward $91,200.

In summary, Bitcoin’s surge above $94,000 has created a rift between short-term retail euphoria and long-term accumulation by whales and institutions.

While technicals and fundamentals both suggest the potential for further upside, the current level of greed and speculation may necessitate a cooling-off period before the next leg of the rally begins.

The post Retail Frenzy as Bitcoin Hits $94K: Santiment Warns of FOMO — Is a Correction Looming? appeared first on Cryptonews.

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