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Searches for ‘Crypto Winter’ are skyrocketing, has Bitcoin entered a bear market?
Searches for ‘Crypto Winter’ are skyrocketing, has Bitcoin entered a bear market?
Less than three months ago, Bitcoin hit $69,000, with many predicting that the cryptocurrency will soon hit $100,000. But that didn’t happen. In fact, Bitcoin has fallen sharply.
Although the market has started to recover from the $32,000 bottom in the last 2 weeks, BTC still has a long way to go to reach the previous ATH zone.
This has led many to question, has crypto winter arrived? And will the Ice Age happen after BTC really explodes in 2021?
Typically, a crypto winter can be identified by a series of red candles on the monthly time frame. According to some, it might be too early to assume that winter will overtake the market.
The search volume increases
According to the latest data from Google Trends, searches for the term “Bitcoin Winter” rose to 100 in the past week, before that, from 07/11/2021 to 11/13/2021, the number was just level 7. This shows the , winter or not, many people really want to learn about it.
Searches for “Crypto Winter” soar | Source: Google Trends
That’s not all. At 44, the Fear and Greed Index doesn’t give much confidence either. This indicator has changed from “Extreme Fear” to “Fear” in the last 30 days.
Most analysts are revising their initial predictions for Bitcoin Winter. Additionally, some say the market could face tougher times.
According to the Huobi Research Institute, Bitcoin will an asset class that is very sensitive to changes in liquidity. With Federal Reserve austerity policies, BTC is facing “a bear market.”
Also in Messages Recently, Glassnode also argued that while it’s difficult to define a bear market for Bitcoin, there are some signs that something similar is happening.
Opposite point of view
Still, analysts emphasized that it is currently “difficult to determine” whether crypto winter is imminent and there is still no consensus on what constitutes a Bitcoin bear market.
For example, Quantum Economics analyst Jan Wüstenfeld takes the opposite view, saying:
“BTC’s price decline this cycle is quite small compared to previous bear markets.”
Wüstenfeld believes BTC is still holding up pretty well, claiming that these dips are like a “mid-cycle correction.”
So far the price markdowns after both #Bitcoin ATHs this cycle has been small and short compared to previous bear markets.
If this bear market looks like this, I’ll take it. ???? ????
While not exactly the same, they look more like mid-cycle corrections. ???? pic.twitter.com/wd6JyIcZ9M
— Jan Wüstenfeld (@JanWues) February 12, 2022
There are also other metrics that suggest bitcoin is in for brighter days, winter or not. In fact, many indicators, as well as analysts, support Wüstenfeld’s claim that the past 10-12 weeks have been just a “mid-cycle correction.”
For example, the Short Term Holders SOPR (STH SOPR) indicator broke through level 1 after remaining below that level for 80 days. That means investors are now selling Bitcoin for a profit. The last time STH SOPR fluctuated below level 1 for a period of 74 days.
Short-term holders SOPR indicator | Source: Cryptoquant
Finally, the stablecoin supply indicator has crossed the EMA7 with the EMA21 on the chart. Historically, this happened before a bull run began.
What’s happening?
However, these figures do not suggest that a “bear market” is not currently taking place in Bitcoin. Indicators such as the whale share on exchanges have been over 85% since the beginning of the year.
This means that there is no right or sure answer. It could be a mid-cycle correction or a major pullback, and market conditions are constantly changing.
Overall, no one will be able to do this suspect totally accurate about the current market situation. Maybe the Fed will hike rates, maybe Russia will invade Ukraine, or maybe Elon Musk will tweet about Bitcoin again. It is best for investors to do their own research.
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Author: Annie
