- Weighted Social Sentiment indicator was used to analyze ETH and other altcoins.
- Based on the data, traders are currently exhibiting fear.
- However, current negative social sentiment does not mean the same buying opportunity as last year.
Ryan Selkis, popular crypto commentator and Messari Founder shared the same view on the market. He tweeted,
Honestly I’m reading the trader tweets at this point in real time. Doesn’t change my long term thesis, but does impact my mid-term risk management.Generally speaking though, BULL
— 0xRyanSelkis (@twobitidiot) May 30, 2021
With that being said, the Weighted Social Sentiment indicator was brought up to analyze the altcoins. To understand further, this indicator combines the positive/negative commentary, and multiply by the amount of social volume. Generally, prices top out when this gets too high, and bottoms when getting too low.
Source Twitter
Based on the data, traders are currently exhibiting fear and there is some caution present in market conditions. Most coins haven’t registered instant recovery, and it has led to the drop of weighted social sentiment.
Historically, such market periods have also been a profitable buying opportunity. While some altcoin traders buy at the current market prices, it might be more reasonable to hold for now. More so, considering Ethereum to be the major flag-bearer of the Altcoins, it shows a negative sentiment as of writing.
Currently, Ethereum and other Altcoins have surged past their previous highs. Cardano registered 10x gain since then, and Polkadot entered the top 10 crypto ranking. Meanwhile, MATIC is on a tear, and Uniswap is leading the DEXs revolution. Buying and Selling volumes are soaring aggressively for these assets. Plus, we have already gone through one major bull cycle.
Therefore, the current negative social sentiment does not mean the same buying opportunity that we experienced last year. It is simply because most Altcoins have higher realized values at the moment.
It might be adventurous to take a chance with Altcoin last year, but traders need to be careful before buying now. The market does not scream bullishness yet, so it is better to wait for now and look for bull confirmations.
This article was first published on coinquora.com