As the bitcoin bull run continues forward, investors brace themselves for the transition into the second and final phase, marked by euphoria and frenzied price movements. James Check, lead on-chain analyst at Glassnode, sheds light on this impending shift, offering insights into what lies ahead for the digital asset market.
Bitcoin Bull Run: Second Phase of the Market
According to Check, the current phase, characterized by enthusiastic bullish sentiment, commenced in October 2023 and reached its peak when bitcoin soared to an all-time high earlier in March. However, Check predicts that the next phase will be defined by heightened excitement among investors, leading to increased volatility in the market.
“As we transition into the euphoric bull phase, we anticipate people becoming more and more excited, fueled by heightened media coverage of Bitcoin,” Check remarks.
This surge in demand is expected to drive prices upward until supply enters the market to meet the escalating demand. Reflecting on the strength of the ongoing bull market, Check highlights its resilience, noting the absence of significant corrections throughout the rally.
He added:
“The market has consistently found support swiftly, indicating robust underlying momentum.”
Indeed, the current bull market stands out as one of the most potent in Bitcoin’s history, bolstered by a series of smaller corrections that failed to dampen overall bullish sentiment. This resilience suggests a robust foundation supporting the upward trajectory of bitcoin.
Jim Cramer’s Warning
Meanwhile, notable financial figure Jim Cramer has sounded the alarm, characterizing the current market climate as “the most overbought” it has been in recent memory. This pronouncement coincides with bitcoin’s notable achievement of logging seven consecutive months in positive territory, marking a milestone not seen since 2012. Cramer writes on social media platform X:
“Coming in the most overbought we’ve been in a while. Better seller than buyer.”
However, there’s speculation swirling around Cramer’s warning, with some questioning whether it’s merely an April Fool’s joke. Others have adopted a contrarian view, pointing out Cramer’s track record and suggesting that his statements could serve as contrary indicators, also known as “inverse Cramer” effect.
Interestingly, Tuttle Capital Management’s ill-fated attempt to launch the Inverse Cramer Exchange-Traded Fund (ETF) last year adds another layer to the ongoing debate about market prediction and sentiment.
Despite these discussions, Bespoke Investment Group has highlighted the emergence of overbought signals across all index-based ETFs in the U.S., indicating a potential trend worth monitoring closely. As per the data from CoinMarketCap, the price of bitcoin stands at $65,600 after a 6% fall yesterday evening, while the trading volume of the digital asset stands at almost $35 billion with a market capitalization of $1.37 trillion.
Check’s insights offer a glimpse into the evolving landscape of the digital asset market, highlighting the impending shift from enthusiastic optimism to euphoric exuberance. As the bull market enters its final phase, investors navigate uncharted waters, driven by a mix of anticipation and apprehension.
Moreover, analysts alike remain vigilant, monitoring key indicators and trends to discern the underlying dynamics shaping the future of both digital and traditional assets.
