Cryptocurrency markets are currently seeing divergent sentiments between investors with different holding times. Short-term holders are selling off their assets, suggesting bearish sentiment, whilst long-term holders are continuing to invest. This can be further seen in the movements of flows to exchanges and whale holdings, with the former increasing, but the latter showing mild fluctuations.
Recently, some encouraging economic data has been seen on U.S. Producer prices (PPI) rising 0.2% month-over-month and Initial jobless claims increasing to 264,000 for the week ending May 6, however this has not provided enough optimism to outweigh investors' concerns of banking and other macroeconomic uncertainties. This has been further seen in the CoinDesk Bitcoin Trend Indicator shifting to the 'neutral' range, with its two-day moving average crossing below the 10-day and 5- and 20-day averages.
Whilst long-term holders seem to have conviction in the market, it is important to keep an eye on the activity of shorter-term owners, particularly those with larger positions. This will determine the market’s sentiment over the coming weeks. All considered, it is currently a very uncertain time for the cryptocurrency market, and this is reflected in recent performances.
Izabella Allen
- 2023-05-12
What Cryptocurrency Market Sentiment Suggests in Light of Recent Economic Data
Latest economic news on the US Producer Prices Index (PPI) suggests a rise of 0.2% month-over-month and Initial jobless claims increasing to 264,000, yet investor concerns of banking and other macroeconomic uncertainties remain. Cryptocurrency markets current show divergent sentiment between short-term and long-term holders.
