The negative sentiment surrounding the crypto market seems to be continuing, especially with China still spreading FUD around the market. However, it seems that at the moment, there are some signs that could be the reason that a potential recovery may occur in the near future.
Although currently the majority of investors still have negative perceptions, there is some data that can prove that Bitcoin is beginning to recover. It should be noted that no one knows the end of this correction, but some of this data can aid to see the end of the correction.
1. Fear & Greed IndexThe Fear & Greed Index data shows data that hasn’t been seen since April 2020, when the crypto market underwent a deep correction.
https://twitter.com/MatiGreenspan/status/1396403303114813441 At that time, there was a deep correction of Bitcoin (more than 50%) due to the announcement of the Covid-19 pandemic. At that time, the majority of market participants referred to the correction by Bitcoin and the crypto market as “Black Thursday” or “Dark Thursday.” However, it was an excellent time to make a purchase.
The same phenomena is happening, wherein the market corrected more than 50% — a sign of high recovery if the same thing is actually happening.
2. Stock to Flow ModelApart from the Fear & Greed Index data, the Stock to Flow (S2F) Model, which generally predicts the movement of Bitcoin, also shows the same thing. The Stock to Flow predicts that the lower limit of the correction is $30,000
https://twitter.com/100trillionUSD/status/13960218321307443203. The Number of Stablecoins on the Exchange IncreasesThe number of stablecoins that are on the majority of the world’s exchanges is currently at its highest which is a sign that there are large parties waiting to buy. However, there is another possibility that this figure is a flow of funds from new investors who have recently entered the crypto ecosystem.
All these signs move together to prove that there is a potential for Bitcoin to recover in near future. It seems that now is the right time for Bitcoin to start recovering.
Source:
https://medium.com/snapbots-news/snapbots-news-review-good-sign-for-the-crypto-market-bitcoin-starting-to-recover-a5a143c94482