Ethereum Social Sentiment Turns Bullish, But Santiment Warns It Could Backfire
Social sentiment around the altcoin king Ethereum (ETH) has turned strongly positive, but Santiment warns that the sudden reversal could backfire on traders.
“Ethereum traders have quickly pivoted from being extremely bearish to extreme bullish, according to social media data,” Santiment said on X, adding that its latest analysis found 2.7 bullish comments for every bearish one, the highest bullish bias since July.
That’s as the rest of the crypto market, including ETH, corrected in the past 24 hours, according to CoinMarketCap.
Just two days ago there were 0.86 bullish comments for every bearish comment, the second-most bearish bias since April.
Santiment said the rapid swing suggests traders are getting “overly eager.”
“When the #2 market cap nearly rebounded to $3,500 yesterday, the crowd took it as a cue that the asset was back in business,” Santiment said. “But just like their sell-off helped fuel the rally the past couple days, their FOMO can now halt it.”
Prices “historically move [in] the opposite direction of crowd expectations,” it said, adding that a “true buy signal” will be if traders “slow their expectations of a quick return to $4K.”
Analysts Divided On What ETH Will Do Next
The Ethereum price has dropped over 3% in the past 24 hours to trade at $3,280.45 as of 6:51 a.m. EST. That leaves ETH down more than 14% in the past week.
Daily chart for WETH/USD (Source: GeckoTerminal)
From a technical standpoint, ETH’s price is resting on the support level at $3,239. A daily candle close below this threshold within the next 48 hours could lead to a plunge to as low as $2,830. On the other hand, a rebound might result in ETH attempting a challenge at the $3,627 resistance.
Looking at technical indicators, the Relative Strength Index (RSI) is currently in oversold territory, which is usually seen as a buy signal. Meanwhile, indicators like the 9 and 20 Exponential Moving Averages (EMAs) and the Moving Average Convergence Divergence (MACD) show bears still have momentum on their side.
Despite the bearish momentum, renowned crypto trader and analyst Michael van de Poppe told his more than 813K followers on X that current levels are a “great area to be adding $ETH into the portfolio.”
“Dipped its toe into a higher timeframe support zone and bounced firmly,” the analyst said about ETH’s recent price movements.
Not everyone is bullish, though, with analyst Ted Pillows warning that the altcoin could correct to new monthly lows if it loses the $3,100 – $3,200 zone again. He also noted that demand for the crypto has decreased.
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