Bitcoin Price Continues Rally, Positive Sentiment Is Off the Charts

In the past couple of weeks, the Bitcoin price has resurged after months of apparent monetary stagnation.

Bitcoin's recent price hike has also resulted in a retail boom, with a whole host of trading platforms across the world reporting sky-high Bitcoin trading volumes.

"Bitcoin hit its highest daily tweet volume level since June 26th 2019 in the wake of the Twitter scam on July 16th. While it isn't clear that the run-up had any correlation to the scam, we have seen in the past that, all else equal, the more users talking about Bitcoin the better the asset performs."

Over the same time period, trading volume in crypto instruments also increased by 162%. The number of Bitcoin positions opened increased by 222% with a 421% rise for Ether and 170% for XRP. Christophe Michot, sales director at digital asset trading platform CrossTower also claimed that over the course of the past couple of weeks, his firm has observed a 219% increase in daily trading volume as well as a 66% rise in the number of daily average signups over the same time period.

The crypto market rally has come on the heels of positive news such as the U.S. OCC's recent clarification permitting the custody of Bitcoin by banks as well as the announcement of another stimulus package to be issued by the Fed in the near future, which some experts believe will continue to devalue the U.S. dollar.

On July 12, Bitcoin's long-term sentiment score - a comparison of investor sentiment over the last 50 days vs. the prior 200 - hit a new all-time high leading up to Bitcoin's run at the end of the month.

Even after Bitcoin failed to surpass the $12,000 mark and retraced by $1,400, investor sentiment fell below 50 for only about 28 hours, alluding to the fact that investors have remained extremely positive on Bitcoin.

Frank told Cointelegraph that approximately 68% of all tweets discussing the long-term financial future of Bitcoin over the past month have been positive.

BTC Fear and Greed Index's correlation with its price Another aspect worth exploring is the relationship that may or may not exist between Bitcoin's Fear and Greed Index and its price, and if the metric can suggest a possible price direction.

"While the price of Bitcoin isn't back to all-time highs, this was the fastest price gain over a 10-day period in its history, which would read extremely greedy, and so maybe it is time to sell and wait for a pullback to re-enter."