- Santiment’s report explains that three events will be the recipe for a recovery in the crypto market this new year.
- Anonymous cryptocurrency analyst Smart Contractor claims that the worst period of the bear market is over.
On-chain analysis company Santiment has analyzed the scenarios that will lead to the next growth in the cryptocurrency market. In its latest analysis, Santiment noted that discussions on social media tend to focus more on Bitcoin than other crypto-assets when markets are rising. The company also noted that discussions about Bitcoin on social platforms in the second half of 2022 ranged from 12.5 percent to 16.6 percent of all crypto asset discussions.
Signs of a crypto market rally
However, in typical market situations, that figure is always around 20 percent. Santiment’s report further explains that three events will be the recipe for a crypto market recovery this new year. They are justice against former FTX executives, increased confidence in cryptocurrency exchanges, and a further increase in discussion of BTC on social platforms until it approaches the 20 percent range.
As of this writing, BTC is trading at $16,824, according to data from Coingecko. However, the leading digital asset was still more than 75 percent away from its November 2021 peak price. According to Santiment, last year was a bullish year for BTC based on its 4-year cycle.
Historically, in BTC’s 14 years of existence, 2014, 2018 and 2022 have been its worst performing years. The analytics firm further noted that these accumulation years always occur in a year when the digital asset has set new all-time highs (2013, 2017, 2021).
Sentiment noted that while this shift between euphoric and profitable years has become somewhat predictable over the past four years, it is still not a perfect alpha engine for prices to rise or fall.
Is the worst of the bear market over?
Meanwhile, Smart Contractor, the dreamy cryptocurrency analyst who gained notoriety after his accurate prediction of BTC’s 2018 low, claims that the worst of the bear market is over. Speaking to his 217,400 Twitter followers, Smart Contractor commented that the start of the new year could bring some new drops.
However, market conditions will improve as we move into the year.
It’s safe to assume that the cryptocurrency carnage is behind us, as an estimated $2 trillion in wealth destruction has occurred with FTX’s bankruptcy filing. Let’s hope for better times.
The worst of the crypto bear market is behind us, we may yet see a new low in Q1, but with FTX registering.
Bankruptcy and the destruction of nearly $2 trillion in wealth, it’s safe to assume that most of the crypto carnage is behind us.
— Bluntz (@SmartContracter) January 3, 2023
The crypto analyst further said that tech stocks, particularly Tesla shares, have a strong price correlation with Bitcoin. According to him, the BTC-TSLA chart correlation is crazier than crypto’s broader correlation with tech stocks over the past two years.
Smart Contractor also shared information about Ethereum’s price action. He said the smart contract platform will soon break above the $1,226 resistance level and trade between $1,260 and $1,280. The analyst said:
Ethereum is trying to break the 4-hour horizontal resistance and could complete the advance after the end of the holiday period of low volatility. So, it should trade between $1,260-$1,280 levels.
Current data from Coingecko shows the top altcoin trading at $1,250, down 0.2% in the last 24 hours.