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Santiment: Cautious market sentiment may continue to dominate before a significant increase in trading activity

ChainCatcher news, according to Santiment analysis, since peaking on February 27, the trading volume across the cryptocurrency market has been steadily declining. After further declines in market capitalization over the past two weeks, trader behavior shows a mix of fatigue, despair, and capitulation.The report analyzes that when the trading volume of major cryptocurrencies continues to decline, even during slight price recoveries (as seen on Wednesday), it usually indicates that trader enthusiasm is waning. In this scenario, traders become cautious, suggesting they may not believe the current price increase will be sustained. Essentially, the decrease in trading activity reflects uncertainty, as fewer traders are confident that buying at current price levels will yield profits.The weakening trading volume during a mild price rebound could be an early warning sign of diminishing market momentum. Without strong buying participation, price gains may quickly lose momentum due to a lack of sufficient support to maintain an upward trend, which could lead to any rebound being temporary, with prices susceptible to decline again.To show a healthier and more sustainable recovery, bulls typically hope to see both price increases and trading volume rising simultaneously. Cautious market sentiment may continue to dominate until there is a significant increase in trading activity.
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