Key PointsRetail sentiment across Bitcoin, Ethereum and XRP has flipped sharply negative as prices slide.Bitcoin’s Net Unrealized Profit (NUP) ratio has fallen to 0.476, a level that historically signals short-term market bottoms.Institutional investors remain cautiously bullish, with 61% planning to increase exposure ahead of expected ETF and regulatory catalysts.Retail sentiment has soured across major cryptocurrencies as the market extends its multi-week downturn, according to new data from on-chain analytics firm Santiment. Traders have turned defensive as Bitcoin once again dropped below $100,000, sliding toward the $98,000 range on Wednesday.Santiment’s latest sentiment screens show the shift clearly: Bitcoin’s bullish-to-bearish ratio has flattened, Ethereum’s sentiment is only barely positive, and XRP has slid into one of its most fear-weighted readings of the year.The firm noted that this pattern of broad retail pessimism typically appears near inflection points, not at the beginning of deeper downtrends.Historical Bottom Signals Re-EmergingOn-chain metrics are aligning with the sentiment reversal. Bitcoin’s NUP ratio — which measures the average unrealized profit held by investors — has dropped to 0.476, a level that has preceded short-term market bottoms multiple times over the past two years.Similar readings in 2024 led to double-digit rebounds as long-liquidation clusters cleared and stronger hands stepped in to accumulate.Total crypto market capitalization has now slipped to $3.47 trillion, continuing a month-long decline. Yet analysts argue that the current move resembles a medium-term correction, not a structural breakdown in the broader cycle.FxPro senior market analyst Alex Kuptsikevich told CoinDesk that while attempts to form a local bottom are visible, “rallies are still met with heavy selling,” which is typical of a corrective phase.Institutional Positioning Remains SteadyWhile retail sentiment deteriorates, institutional flows have started turning more constructive into year-end.A recent Sygnum survey found that 61% of institutional investors plan to increase crypto exposure ahead of anticipated altcoin ETF launches and regulatory developments expected in 2026.The accumulation trend is also visible on-chain. Strategy — one of the largest publicly traded Bitcoin holders — acquired 487 BTC over the past week at an average of $102,557, bringing its total holdings to 641,692 BTC.Ethereum exchange reserves have fallen to their lowest level since May 2024, a historically bullish signal indicating coins are moving off exchanges and into long-term storage.A Setup for a Reflexive Rebound?Despite continued price pressure, several factors are aligning in favor of a short-term reversal:Retail sentiment has reached capitulation-like levels.Long-liquidation clusters have been flushed out below $100K.Exchange balances for major assets continue to decline.Institutions remain net accumulators.Historically, this combination has supported swift reflexive rallies rather than deeper capitulation, especially when retail steps back and larger players accumulate into weakness.BTC, ETH and XRP may still face near-term volatility, but on-chain and sentiment data suggest the market is moving closer to bottoming conditions than to the start of a new downtrend.
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