Analysts: Tuesday's sell-off may mark a local bottom

TradingView data shows that the total market value of cryptocurrencies is hovering above $2.7 trillion, evaporating nearly $1 trillion since reaching its peak in December 2024. Multiple indicators suggest that Tuesday's sell-off may signal a local bottom. Bitwise Europe research director Andre Dragosch emphasized that the cryptocurrency sentiment index has dropped to its lowest level since August, coinciding with the unwinding of yen carry trades, with Bitcoin bottoming out around $49,000. "The cryptocurrency sentiment index has just issued a large contrarian buy signal for Bitcoin. Widespread bearish sentiment in fund flows, on-chain data, and derivatives indicates that downside risk is quite limited. At these prices, the risk-return prospects seem quite favorable," Dragosch pointed out.