A significant number of retail investors are forecasting that the price of bitcoin will exceed $90,000 in the near future, potentially turning the year-to-date return from negative to positive. However, it remains to be seen whether the market will follow this trend.
Analytics firm Santiment analyzed thousands of social media posts across various platforms and found that the majority of users are expecting the price of bitcoin to rise above $90,000. Mentions of lower price ranges are being dismissed as fear, uncertainty, and doubt.
The crowd is expecting the recovery from the February low of around $60,000 to continue into May, driven by factors such as increased flows into exchange-traded funds and bitcoin's resilience in the face of recent global events. However, Santiment warns that this bullish sentiment may be a contrarian indicator, suggesting that the opposite outcome is more likely. The firm notes that overly optimistic price predictions can often precede a bearish performance.
This phenomenon is not unique to the cryptocurrency market, as contrarian traders in traditional markets also use sentiment gauges to inform their decisions. Interestingly, bitcoin's recovery rally has already stalled this week, with prices pulling back to $77,000 from highs above $79,000 on Monday, leaving uncertainty about whether this is a pause or the start of a broader reversal.