Will Crypto Recover Soon? Bitcoin, XRP, Ethereum, Hyperliquid, & Solana Analysis!

[00:00:00]Clearly there are more objectively more bearish comments than bullish comments coming out which is rare for Bitcoin especially and because of that uh you should actually feel a little bit hopeful that the bottom is near. Doesn't mean it's going to happen instantly, but usually with this [music] kind of velocity of a price fall combined with very fearful sentiment, uh it's not long before we see some relief rally.

[00:00:36]Hey everyone, welcome into the Thinking Crypto podcast. I'm your host Tony Edward and joining me today is Brian from Santiment. And as you all know, we're going to do a deep dive into the metrics around Bitcoin and altcoins to get an idea of what's happening in the market and what may come next. Brian, great to see you. Good seeing you, Tony.

[00:00:53]Obviously, uh we're meeting on a day that Bitcoin's fallen to about a two-month low here. So, moods across uh socials are not so high.

[00:01:03]>> Yeah, it's pretty tough out there, Brian. Especially, you had news yesterday that Michael Sailor uh Strategy sold, you know, some Bitcoin even though it's not a big amount. Just the psychological impact I think is the key.

[00:01:14]>> It's the optics, right? It's not so much the amount. 32 Bitcoin is uh a drop in the bucket compared to what they have accumulated and still hold, but it's enough for people to look at it suspiciously and go, "Wait, you know, the firm and the individual sailor that claimed they're never going to sell are now doing the opposite of what they promised. they've kind of kept up the house of cards, which is crypto, uh, in a lot of people's eyes. So, um, now that they're selling, is this the first of many? Right. I think that's kind of the dominant narrative that's starting to form.

[00:01:53]>> Sure. So, uh, as much as I don't want to look at it, can we look at sentiment?

[00:01:57]I'm sure it's pretty bloody and nasty.

[00:01:59][laughter] >> Yeah. I mean, if anything, we should be rooting for sentiment to be low, as strange as it sounds. But, uh, as we've talked about many times on our show here, Tony, >> prices typically move the opposite direction of the crowd's expectations, right?

[00:02:15]>> And, um, we'll just start right here because this represents where the narrative is pouring in right now. The mentions of sailor or strategy has exploded. Here, I'll make it a little more zoomed out so we can see just the past 24 hours. Look at this social volume spike uh on May 31st going into June 1st. It just exploded as the news about his first sale poured in. Um and it's pretty obvious that the the crowd has attributed the reason uh to this fall being directly correlated to their sale. Even though 32 bitcoin uh being sold happens multiple times a day, it's just happening from the firm that's not supposed to sell. Therefore, we now have the quote unquote reason for this fall, even though it's always more complex than that.

[00:03:10]>> Yeah, that's a great point. This is a narrative, right? And narratives move with follow price. So if it's a negative with the with the price going down or positive with the price going up and to your you know your point Sailor just sold a little bit but is just this big pivot from him and strategy because they've talked about for years we're never going to sell. Bitcoin's going to keep going up and now all of a sudden you have to sell and look at the timing of it. um it kind of aligned with the charts because the chart was showing some weakness and this was the catalyst that you know broke the floor that Bitcoin was holding.

[00:03:47]>> Yeah. And I'm not I'm certainly not going to go after him or defend him. Uh but I do know that from their explanation, this has more to do with the ST STRC stock and some specific reasons behind a small amount needing to be sold for the purpose of uh taxation or dividends. I'm sorry for those who know more than me about it, but I know they gave an explanation.

[00:04:15]This wasn't just an out of left field sell uh where they just said surprise everybody now we're bearish on crypto.

[00:04:23]>> Yeah. So, it's, you know, as far as sentiment, is there a lot of fear here pretty much that uh people are seeing are starting to turn on Bitcoin essentially?

[00:04:35]>> Yeah, no doubt. Uh we actually just put out a post. I'll just refer directly to what we just put out here because we have two of them about sentiment today.

[00:04:45]And um as you can see this ratio here which represents the bullish versus bearish sentiment for cryp for Bitcoin.

[00:04:54]It fell to its lowest point in about two months yesterday and it's still below this FUD zone line today right here. So, uh, clearly there are more objectively more bearish comments than bullish comments coming out, which is rare for Bitcoin especially. And because of that, uh, you should actually feel a little bit hopeful that the bottom is near.

[00:05:22]doesn't mean it's going to happen instantly, but usually with this kind of velocity of a price fall combined with very fearful sentiment. U it's not long before we see some relief rally. And how long that relief rally really depends on how much retail then flips back to greed. Right? If it's a big relief rally, sometimes you suddenly see, oh, we're all back and we're going back to 100K as the dominant narrative. And you don't want to see that either. You want people to kind of remain suspicious, remain fearful, think that Sailor is going to keep on selling even though there's an argument that that probably won't happen. Um, and as long as the sentiment remains cautious to extremely freaked out, uh, we could be in good shape for a nice rally back to 75K at least, uh, in the near future. Yeah, absolutely. And this just this morning I posted on, uh, all the socials, Bitcoin RSI in the daily chart is in the extreme oversold zone. So to your point, sentiment aligns here, right? People are fearful. They're like, "Wait, this this looks fishy. Sailor's going to dump more uh you know, whatever scary narratives are out there." And the metrics on the chart show we're nearing a bottom as I also looked at the MVRV on sentiment and that also showed uh you know, the 30 days underwater. Yeah, let me jump to MVRV in just a moment. I just wanted to support the last argument about our sentiment by showing the lower or below mentions versus higher or above. They all have their own color when we look at specific platforms, but in short, Reddit has red as the lower or below and Twitter/X has blue as the lower or below. Both of these bars, respectively, have spiked for the lower narrative. So, people are expecting prices to continue to sink at their current levels right now. And when they're expecting, that means they're capitulating. That means they're selling to the larger wallets and those larger wallets traditionally will push prices up not instantaneously but um typically in the near future if this trend continues. So MVRV wise as you said here's a a quick graphic to represent what you already looked at Tony uh the 30-day MVRV is sitting at about minus 11% while the 365day is down at - 26%. both are uh revealing that blood is uh clearly in the streets right now and retail on average is down a pretty sizable amount of money. The 30-day MVRV hasn't been this low since midFebruary almost a fourmonth low in terms of the shortterm average trading returns. Typically, anything below -10% is considered about a nice opportunity zone where you could buy or add on to your position with less risk than the average time in Bitcoin's 18 or so year history. And I wonder, Brian, you know, market makers, it's so funny once I have learned all these things and looking at metrics on sentiment, you know, could they be looking to trap the bears, right? We have all the respective things aligning here. Uh where the herd is fearful, right? Everybody's scared.

[00:08:51]>> MVRV is at these levels. RSI is touching the oversold zone and bears go and launch a whole bunch of shorts and then all of a sudden a short squeeze happens.

[00:09:02]Exactly. These are all great signs. I mean, if the metrics were exclusively showing that we've got this huge bullish divergence, you know, we'd be saying so.

[00:09:13]There are still a few caution flags that are showing up here. Um, for starters, this line, which we always go over on our calls, Tony, the green line especially, that shows the amount of the overall supply held by those key stakeholders that have anywhere between 10 all the way up to 10,000 BTC. They've been declining. And especially recently over the past 4ish days or so, uh they've dropped um a total amount of a little over 20,000 20.6,000 BTC. Um so this fall is being supported by some mild smart money dumping going on. Uh this is actually the lowest amount of supply held since April 12th or so. Uh so we're closing in on a two-month low in terms of what the key stakeholders have right now. Uh meanwhile the retail which are represented by these two lines, they're continuing to go up and we need to see how the next few days play out. now that prices have fallen because sentiment shows that they're likely selling and we'd like to see that represented by the onchain metrics too.

[00:10:34]>> Yeah, absolutely. Yeah. So, this is certainly not a good sign and hopefully uh while it looks like it's going down, maybe they reverse course in the coming weeks and then we see some sort of rally, but obviously that's not guaranteed.

[00:10:47]>> Exactly. And we talked uh before the show about ETFs, Tony, and as you would expect, outflows are pouring in. And they've been pouring in going all the way back to almost a month ago, called about a four-week streak, where every single day has been an outflow more than inflow. Basically, the the net amount of dollars moving in versus out. It's been in the negative every day except for this one. Uh it shows May 13th, but it's 14th actually because my time zone uh is a little behind what the dashboard is set up for. And then this was actually there's some blank right here which is barely barely barely positive. Yeah, right here May 11th. So barring those two outliers, all of these days, every single stock trading day other than two has been a net outflow. And all this has added up to somewhere around like6 billion if I I need to update that number, but when I checked it uh last week it was around5.5 and we've seen them continue to drop. So uh $6 billion or more somewhere in that range has fallen out of ETFs, Bitcoin ETFs specifically over the past four weeks.

[00:12:08]>> Wow. Um obviously it's all cyclical and I don't know we might go lower as far as the price but we've seen um you know when you have this amount again in addition to all the metrics we just covered the there this there seems to be light at the end of the tunnel here and and this is um you know we're going to probably see a a flip a return or inverse of of this and I I I don't imagine that the outflows are going to continue to you know go crazy here. I think there's going to be a reversal soon, but that's just me.

[00:12:40]>> Yeah. And and we've talked about this and we've kind of changed our thesis over time because the beginning of the ETFs back in 24 and 25 were mainly reflective of what institutionals were doing. But since they've become so popular over the past year or so, they're actually kind of used as a counter signal these days due to the amount of retailers that >> uh get exposure to crypto through ETFs these days. You can see some of the biggest extremes correlating with price tops and the biggest negative extremes correlated with price bottoms. These aren't flukes. These are kind of just reflections of how ETFs can be interpreted these days. And I think all of these bunched up outflows can actually be considered more good news for an eventual flip. And if they continue to outflow, great. That's even more sign that uh retailers are jumping out. uh it doesn't mean that cryp crypto doesn't just follow what ETFs do. This is more just a reflection of how traders feel without impacting anything on chain if that makes sense.

[00:13:46]>> Yeah, absolutely. And then in conjunction with all the other metrics we looked at, it's just a perfect setup here um for going against the herd uh with everybody, you know, feeling uh scared.

[00:13:58]>> Yeah, exactly. Uh I also wanted to pull up this chart here. Look at the difference between stocks and crypto.

[00:14:05]I'm sure you've seen, Tony, the growing narrative that crypto traders should just jump out and go into stock trading because that's where the money is right now.

[00:14:13]>> Yeah.

[00:14:14]>> And of course, that narrative is always lagging because people are going to perpetuate what people should do after the fact that it's already happened. Um, but especially since I mean this is this is pretty historic. I haven't seen anything like this since really the FTX collapse back in November, December 2022. But if I just go from May 5th until now, uh the S&P is up about 5% while Bitcoin's up, I'm sorry, Bitcoin's down about 15 a.5%. And that's a pretty glaring uh counterrelation compared to the usual tight correlation that the two sectors have together.

[00:14:58]>> Yeah, it's funny. I'm starting to see the memes uh you know abandon crypto, go back into the S&P 500 or the NASDAQ or specific stocks.

[00:15:06]>> Yeah. And and I think people are are believing that more and more. So expect for the numbers of uh crypto traders and and investors to go down as long as this pattern continues. And that doesn't mean that crypto is dead or that crypto will uh continue to go down because there's less people in it. It just means that there's going to be less volume.

[00:15:29]Therefore, each individual trade is going to impact price more than they have over the last couple years.

[00:15:37]>> Yeah, absolutely. Um my hope is that look, the stock market itself does look overheated. You know, you look at some of the metrics like uh RSI and so forth, it's very overbought, but it still keeps running as long, you know, S&P 500, NASDAQ, Russell, Dow Jones. It's pretty wild. So hope we can hope that crypto catches up and maybe the setup is this what we're discussing here Brian the extreme fear um all these different metrics people capitulating and then they get uh caught sideline right because they're like oh my god now crypto is ripping I need to jump back into crypto and it's the same story uh the story as old as time yeah I mean we can only see all-time highs in stock markets for so long before we see some healthy retracement uh Um, I I I know the S&P 500 is of course making new record highs seemingly every day. I've saw uh Japan's and South Korea's stock markets respectively seeing all-time highs. Uh, how how much of this is related to Trump's policies is up for you to decide. Um I know that he has a reputation for being a very corporate favorable um president and that could very well be reflecting in how these different sectors have played out over the past few months. But yeah, eventually I do expect that there will be some uh makeup period where Bitcoin starts to play some catchup because that's been the case really going back to early 2022 when um many of you remember uh Jerome Powell was raising interest rates at that time to kind of counter all the COVID policies that had been going on and then 23 and 24 even 25 we saw some interest rate cuts again and crypto went nuts during that time. We know now have a new chair coming in. Um so we'll see how the first FOMC meeting goes under his u his watch and I you know I think it's just about patience right now Tony more than anything. Yeah, for sure. Definitely a patience. Um, and you know what? You look at this chart and even if when you zoom out, you know, every dog has its day, right? Gold and silver were ripping ahead of the stock market and and crypto for a while, then it corrected. Now the stock market's ripping and everybody's like, "Oh man, what's going on crypto?" And then eventually, I think crypto is going to have its turn. It's just uh the nature of the markets.

[00:18:07]>> Yeah, it's very, what have you done for me lately? Right. especially in crypto where the attention span is is uh very low uh because it's a 24-hour market cycle and things have traditionally always moved much quicker than uh traditional equities. So, every day is going to be different and you know even the narratives here have been different as you would expect. It's full of a lot of bearish doom and gloom types of things. BTC cell shock is the number one trending story. We've got some Solana momentum at number two, which is interesting. Mount Mount Gox transfers.

[00:18:43]Um, Toncoin changing its name back to Graham, uh, its native token. That was a big story uh, yesterday.

[00:18:49]>> So, people are all over the place, but I I've seen mainly fear centric types of uh, stories pop up on our dashboards.

[00:19:00]So, on a note, let's look at altcoins.

[00:19:02]Um, I'm sure they're not doing well, especially Bitcoin's not doing well.

[00:19:06]Maybe we could do Ethereum for Yeah, Ethereum for those who remember last week. Last week seemed to be the uh crap all over Ethereum week across social media. Um, and you know, justifiably, I think a lot of people understand what it means when the Ethereum Foundation sees a lot of people depart. And um Vitalik himself has said some somewhat cons concerning things about the number two market cap. But as you would expect, the MVRV for ETH is very low. 30-day MVRV is sitting at 111%. 365day is way down at - 35%.

[00:19:45]So both of these indicate that you could be buying in with much less risk than usual. It's kind of about the same situation as Bitcoin, if not a slightly better picture due to a little more blood in the streets than Bitcoin. So, Ethereum absolutely has very negative MBRV right now.

[00:20:06]>> And I don't know if we need to look at sentiment. It's probably the same like Bitcoin, right?

[00:20:11]>> Yeah. Um, let me pull it up just so we can verify that. But I believe that there was a big drop a couple days ago and I'd see no reason for it to recover right now. So ETH's sentiment, we'll just go to the last. Yeah. So look at this. The overall sentiment right now, the ratio of bullish [clears throat] versus bearish comments is sitting way down at 1.04 to one. So almost an even amount of bullish and bearish comments when it's usually up between 1.5 to like two almost. So very bearish for Ethereum.

[00:20:52]>> Uh how about XRP sentiment and then MBRV?

[00:20:55]>> XRP has somewhat of an okay sentiment right now. Interestingly, uh perhaps due to it just being a little under the radar, not getting the attention relatively at the moment compared to Bitcoin and Ethereum, but nothing too extreme in either direction for the sentiment.

[00:21:14]>> And then as far as MVRV goes, super duper low. Um yeah, much much lower than the others.

[00:21:22]>> That looks really bad. I don't think I've ever seen MVRV like that.

[00:21:25][laughter] >> Yeah, I don't I don't know either. uh 54%. You can see that's a little lower than anything this year. We may have to go way back in time to see a time where it's matched this. Yeah, we have to go back to this little divot here in Nope, it's even higher then. So, we got to go back further.

[00:21:49]Call it September 2022, the last time we saw prices or the average trader returns that low. And look what happened right after.

[00:21:58]>> September 7th is what we have highlighted. If I just hold down shift, >> this was pretty much an ideal time to buy. If we just go till July of the next year, prices went up about 145%.

[00:22:13]If you waited all the way until January of last year, you would have gotten about an 835% return. You get the idea. This is not always going to be a guaranteed buy spot, but we have to go back almost four years to see the last time there were this many negative returns going on. And that that point was a pretty optimal time to buy. Well, Brian, I I'm looking at this. This makes me want to buy a whole bunch of XRP.

[00:22:46]Not financial advice, of course. You got to make sure you look at other metrics, but this looks really really bad. So, it's it's a good counter trend >> uh move.

[00:22:55]>> Yeah. I mean, do your research about any coins you're interested in investing in.

[00:22:59]Uh Tony and I aren't here to tell you what to do with your precious money, but uh if you trust the probabilities and trust the metrics and of course trust how much other people are up or down already on their investments, that can be a pretty good guide for you to make uh some wise decisions.

[00:23:17]>> Absolutely. Uh, can we take a look at Hyperliquid? That that's been performing pretty well. Almost like it's ignoring everything else that's happening in crypto.

[00:23:25]>> Yeah. So, Hyperliquid, we've just got sentiment for now. Um, but hyper. Yeah, it's interesting because we were seeing super high sentiment the last few days, but I think due to the distrust in Bitcoin right now and the overall crypto markets, >> there's been a pivot as of today. And this is actually the lowest sentiment we've seen in about three weeks. Uh which is a pretty good sign because hype hasn't really >> dropped anything to any significant degree. Still sitting at about $72. I know it went above 75 briefly yesterday.

[00:24:03]So the fact that people are expecting a drop right now, a pretty decent sign that the drop won't happen to the degree that people are expecting, even if there is some small one.

[00:24:15]>> Yeah, man. But it's it's been ripping.

[00:24:18]Um you look at the price chart and there was I believe an ETF that got launched.

[00:24:22]So >> yeah, there's a strong narrative especially like it's like a counter narrative to Ethereum. There's a lot of FUD against Ethereum saying see we don't need Ethereum. We got hyperlid.

[00:24:31][laughter] Yeah.

[00:24:34]>> Up about 88% in three weeks. Nearly doubled in market cap.

[00:24:38]>> Wow. How about Salana? That's probably not looking too good. It could be in the same situation as XRP where it's just not being talked about much relative to the others. Yeah, it's right in the middle just like XRP. So, it's plummeted a lot. Um, if we go from the top three weeks ago until now, the price is down another 21 a.5%.

[00:25:00]Sentiment is normal for its range. Um I I just don't It's interesting because it's the number trend number two trending topic right now. Go back here.

[00:25:13]Trending stories. Yeah. So this it's there is some talk about Salana's prices, but it isn't really impacting the fear versus greed at the moment.

[00:25:24]>> Yeah. It's almost like a nothing burger.

[00:25:27]Like there's no there's no significant news item. It just seems like commentary almost which is weird. Um, well, I guess we're going to have to be patient here, Brian, but I I like the setup with the metrics I'm seeing, even though, look, a lot of people may not want to hear me say that, but you know, we always look at what what are the metrics telling us and is it showing the opposite of the herd or what the herd is doing, and that's where you want to be. So, I I like I like these different signals I'm seeing here.

[00:25:54]>> Yeah, more more good signs than bad, for sure. Uh, I'd still like to see the whales and sharks looking a little more uh bullish themselves and and scooping up some coins, but sometimes there's a delay between the panic from retail to the time that the uh key stakeholders really start to make a push. That's such a great point. Like uh obviously there's a lag in the data coming in, right?

[00:26:17]because you have to wait for the date the day for it to complete. But maybe later this week, you you probably might start to see an uptick as they see this this the metrics, they see the sentiment, they see the capitulation and they're like, "Okay, now's the time.

[00:26:30]Everybody's fearful and uh they're giving up. Sailor's going to end and destroy Bitcoin." All those narratives are out there now.

[00:26:37]>> Exactly. Yeah. I I I think there's got to be some relief rally soon anyways just due to the mass amount of bleeding.

[00:26:44]But, um, when the relief rally turns into a full-on bull cycle, we'll align when the key stakeholders decide they're they're ready to to make a a strong push. So, we'll of course look at it in a couple weeks here when we revisit, but hopefully some better news next time.

[00:27:02]>> Absolutely. And folks, if you want to take a look at these metrics and charts and much more in Santiment, link will be in the description. Go check it out.

[00:27:09]Brian, folks can sign up for a free trial, right?

[00:27:12]>> Free trial. Yeah. go to the uh pricing page that I think you'll have in the link in the bio of this video and use code uh thinking crypto to help out our friend Tony here. And um thank you always Tony and and the thinking crypto community for the constant support of what we're building here at Santin.

[00:27:31]>> Awesome. Thank you Brian. Thank you.

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