Bitcoin Slides Into Heavy FUD Zone as Investors Pull Back

Key Takeaways

• Bitcoin is hovering just above $78,000 after a roughly 11% weekly drop, with heavy trading around $52 billion.
• Fear and negative sentiment now dominate crypto social media, signaling weakening investor confidence.
• Short-term holders are in loss, while long-term holders are not yet – suggesting the market may still be searching for a bottom.

Daily trading volume stands near $52 billion, highlighting intense activity as investors react to the sharp pullback.

Social data shows fear is now firmly in control. According to Santiment, negative commentary around Bitcoin has surged to levels last seen during the late-November sell-off. Since the January decline, online discussions have turned decisively bearish, with retail investors increasingly selling into weakness.

Source: Santiment X

The persistence of negative sentiment is weighing heavily on confidence across the crypto market. Many newer investors who entered at higher prices are now facing losses, reinforcing caution and sidelining capital.

Historically, periods when fear overwhelms social media have often preceded short-term rebounds, but for now the mood remains defensive.

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Long-Term Holders Still Holding the Line, Short-Term Holders Under Pressure

On-chain data shows that short-term holders are already deep in unrealized losses. This phase is typical during market corrections, as recent buyers tend to exit first when volatility spikes.

Their selling pressure has contributed to the recent drawdown and the surge in pessimistic sentiment.

Source: Alphractal

Long-term holders, however, have not yet moved meaningfully into loss territory. According to analysis shared by Joao Wedson, major Bitcoin bottoms usually form only after losses spread from short-term holders to long-term investors. That transition has not occurred yet, suggesting the market may still be in a discovery phase rather than a confirmed bottom.

Key Levels to Watch Going Forward

The relationship between short-term and long-term realized prices remains a crucial signal. In previous cycles, bear markets ended only after short-term realized prices fell below long-term levels and later reclaimed them. Until that pattern emerges, volatility is likely to stay elevated.

For now, Bitcoin’s ability to remain above the mid-$70,000 range will be closely monitored. Extreme fear, fading confidence, and mounting pressure on recent buyers define the current landscape, leaving markets highly sensitive to shifts in sentiment and on-chain behavior.

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The information provided in this article is for educational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.

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