Bitcoin has set a new all-time high and Ethereum is closing in, but analytics firm Santiment cautions that key on-chain metrics may be signaling overheating in the market.
In a recent analysis, Santiment pointed out that Bitcoin’s trading volume has dropped since July’s peak, creating what it calls a “bearish divergence.”
Network activity has also slowed, with declines in daily active addresses and growth, raising questions about whether current price levels are sustainable.
Their MVRV (Market Value to Realized Value) metrics also suggest potential pressure ahead. Bitcoin’s long-term MVRV sits at 21%, hinting at limited upside.
For Ethereum, the picture looks even riskier, with a 90-day MVRV of 40% and a 365-day MVRV of 57% — levels Santiment says could trigger stronger corrections.
Whales Hold, Retail Buys
Santiment’s data shows Bitcoin “whales” holding 10 to 10,000 BTC have steadily accumulated since March without selling, signaling long-term confidence. Retail investors with smaller holdings are also buying, but analysts warn that simultaneous buying by both groups typically precedes a cooling-off period.
Signs of Market Euphoria
On social media, “buy the dip” chatter has spiked following the latest pullback, which Santiment views as a contrarian indicator of excess optimism. Analysts conclude that the mix of slowing fundamentals, high MVRV ratios, and euphoric sentiment should encourage caution, even as Bitcoin and Ethereum push toward historic price levels.
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Alex is an experienced financial journalist and cryptocurrency enthusiast. With over 8 years of experience covering the crypto, blockchain, and fintech industries, he is well-versed in the complex and ever-evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His approach allows him to break down complex ideas into accessible and in-depth content. Follow his publications to stay up to date with the most important trends and topics.
Source: https://coindoo.com/market/bitcoin-and-ethereum-price-outlook-santiment-warns-of-market-cooling-ahead/