Statistical Twitter Sentiment Analysis Data Reveals the Masses are Warming Up-to Bitcoin Rapidly
As many of us may already be well aware of, every day thousands of internet users post flurry messages regarding various altcoins such as Bitcoin, Ethereum, EOS across a host of different social media platforms (such as Twitter, FB, etc). This data can then be used to gauge the collective sentiment of the market towards the digital currency sector.
In this regard, as per an all new data analysis piece released recently, more than 98% of all Twitter users are currently “positive” about Bitcoin’s future prospects. To be even more specific, we can see that there approximately 22,000 tweets are released about Bitcoin each and every day — out of which, an overwhelming majority of them are in support of the flagship digital asset.
So What Do These Numbers Actually Mean?
In light of the numbers presented above, the folks over at Circle Research recently analyzed some of the data put forth by The Tie — an analytics firm that uses public sentiment data to gauge the future price movements of various commodities — and found that there currently exists a strong correlation between
“BTC’s online Twitter sentiment and its price action (and vice versa).”
- To facilitate its studies, The Tie employs a “long-short trading strategy” that has been devised using a plethora of market indicators.
- The firm’s latest data seems to suggest that over the course of the past 12 months or so, Bitcoin’s market sentiment has successfully moved from “capitulation to hope.”
- In its Q1 report for 2019, Circle’s market analysis team found that Bitcoin has been experiencing a strong surge of positive sentiment since the start of the year.
On the subject, Adamant Capital’s Tuur Demeester was recently quoted as saying:
“Bitcoin is in the last stage of this bear market: the accumulation phase.”
Other Data Worth Pointing Out
- Circle Research makes use of a unique regression model in order to compare the market sentiment associated with BTC and ETH. The resultant score — as was to be expected — exhibited strong correlations between the price of both assets (+0.71, +0.64, respectively.)
- The aforementioned report also highlights a “strong correlation” between Bitcoin’s tweet volume and price. With that being said, it should be pointed out that BTC’s current tweet volume is nearly 1/4th of what it was back in Dec-2017.
- These strong links seem to suggest that the value of ETH and BTC may surge quite rapidly in the near future.
While Twitter data in no-way should be considered to be the final word when it comes to analyzing the monetary future of a financial commodity, it does, however, serve as an extremely useful indicator to assess the public’s overall sentiment towards it. It now remains to be seen what the financial future of BTC looks like.