XRP & Litecoin See Social Media FOMO: Bad Sign For Prices?

Share This Post

Data shows that users on social media are overwhelmingly showing FOMO towards XRP and Litecoin, something that could be a bearish sign for their prices.

Weighted Sentiment Has Spiked For Both XRP & Litecoin Recently

According to data from the analytics firm Santiment, LTC and XRP are among the coins that have seen an improvement in sentiment following the recent price recovery. The indicator of interest here is the “Weighted Sentiment,” based on two other metrics: Sentiment Balance and Social Volume.

The Sentiment Balance tells us about the current net sentiment on major social media platforms. This indicator works by putting posts/threads/messages related to a given coin through a machine-learning model to identify whether they are positive or negative.

Once the metric has found out the number of posts of each type, it takes their difference to determine the net situation around the asset on social media.

There is perhaps one flaw in the Sentiment Balance, though, and it’s the fact that it contains no information about how many users share this sentiment. Sometimes, discussion around the cryptocurrency can be low, so whatever the metric would signal would only correlate to what the few users talking about it think, which may not necessarily relate to the majority.

The Weighted Sentiment fixes this problem by also incorporating Social Volume data. The Social Volume keeps track of the degree of talk that any given asset receives on social media platforms.

Thus, the Weighted Sentiment only registers a spike (in either direction) when not only does the Sentiment Balance have a high value but also the Social Volume is signaling the presence of high discussions.

Now, here is a chart that shows the trend in this metric for Litecoin and XRP over the past month:

Litecoin & XRP Weighted Sentiment

As displayed in the above graph, the Weighted Sentiment has seen spikes into the positive territory for both XRP and Litecoin with their recent price surges. This suggests that many positive posts have appeared around these coins.

Historically, highly positive sentiment has been a bearish sign for any asset, with tops becoming probable as investors FOMO. The chart shows that XRP had seen a rise in FOMO earlier in the month, and the cryptocurrency had set a top alongside this spike.

As such, the latest spike in the Weighted Sentiment may not be ideal for the recovery runs that XRP and Litecoin have started. “These coins can continue to rise, but the crowd’s euphoria toward these assets could make them high-risk, high-reward investments this week,” notes the analytics firm.

XRP Price

XRP has enjoyed a rally of almost 26% in the past week, which has taken its price back above the $0.54 level.

XRP Price Chart

Read Entire Article
spot_img
- Advertisement -spot_img

Related Posts

Ethereum Price Nears Critical 100-Day SMA – Will It Break Through?

Ethereum (ETH) has been on a slow and steady upward trajectory, inching closer to a crucial technical indicator: the 100-day Simple Moving Average (SMA) This level is more than just a line on a

Fake ‘Investment Education’ Crypto Scams Are Exploding—Regulator Issues Dire Warning

Fake “investment education foundations” use deceptive trials and bogus loans to scam cryptocurrency investors, North Dakota regulators warn Regulator Sounds the Alarm: Fake ‘Investment

Promises Made, Promises Kept

Last week America officially started a Strategic Bitcoin Reserve, but the Market doesn’t seem to care yet Last Week Macro Arguably Mattered More Than Policy Trump and macro dominated last week

Bitcoin Theft: UK NCA Officer Charged For Stealing 50 BTC

The UK Crown Persecution Service (CPS) has filed charges against a law enforcement agent for allegedly stealing 50 Bitcoin (BTC) in 2017 This development comes amidst continuous efforts by the UK

Bitcoin Price Breaking Out Of This Pattern — Can BTC Reclaim $90,000?

The Bitcoin price has shown good signs of recovery over the past few days, briefly returning above the $85,000 level to kickstart the weekend While BTC’s price has often floundered towards the end

Fixing Ethereum’s biggest problems

The following is a guest post from Rostyslav Bortman, Founder at Ethereum Ukraine If you’re planning to launch a stablecoin or preparing for a token generation event (TGE), your choice of