New data from market intelligence firm Santiment highlights the four key trends currently influencing the cryptocurrency markets. According to a recent blog post by the crypto analytics platform, October is witnessing an upswing driven by optimism surrounding Bitcoin (BTC) and XRP, while concerns are emerging due to developments related to Reddit and the Federal Reserve.
Santiment notes that the recent achievement of Bitcoin hitting $30,000 twice within a week and the U.S. Securities and Exchange Commission (SEC) dropping its charges against Ripple executives Brad Garlinghouse and Chris Larsen have injected fresh bullish sentiment into the markets. The discussions surrounding BTC’s $30,000 range are typically marked by celebration and high levels of FOMO (fear of missing out). However, when Bitcoin is attempting to break through a long-term resistance level, it’s preferred to see a more subdued crowd sentiment. Major price spikes can often signal a market top due to excessive excitement.
Regarding the Ripple/XRP lawsuit, Santiment suggests that the high discussions about the legal victory may already exhibit a “buy the rumor, sell the news” aspect. XRP witnessed a 10% jump when insiders first received the news, but now that the details of the victory have become public knowledge, XRP hasn’t shown any significant decoupling from the overall market.
On the more bearish side, Santiment points out that concerns have arisen due to Reddit users losing the ability to tip other community members using tokens like MOON and DONUT. Additionally, a more hawkish stance taken by the Federal Reserve is worrying investors.
However, Santiment emphasizes that the Federal Reserve’s stance is only relevant if the crypto markets start moving in tandem with the S&P 500 once again. The analytics firm notes that high discussions related to Reddit discontinuing its token tipping may reflect an overall sense of FUD (fear, uncertainty, and doubt) in the crypto market, which could potentially have a positive impact on prices. It’s worth monitoring whether there’s a surge in negative posts in the days leading up to the official removal of MOON and DONUT tipping on November 8th.
Furthermore, discussions related to Federal Reserve Chairman Powell’s comments and concerns about the U.S. economy expressed by the Fed are expected to impact the cryptocurrency market only if the crypto sector resumes tracking the S&P 500. Presently, cryptocurrency prices are closely aligned with the value of gold, which could be attributed to geopolitical tensions. However, there’s a possibility that these sectors will once again start moving in sync, meaning that adverse news from the Federal Reserve might lead to cryptocurrency price tops, as observed in 2022 and early 2023.
