Santiment: Crypto Market Trading Volume Continues to Decline Since February 27, Market Sentiment Turns Cautious

BlockBeats News, March 13th, Santiment published a post on the X platform stating, "Since the peak in trading volume on February 27th, the overall trading volume in the crypto market has been continuously declining (at that time, traders optimistically bought the dip). After further decline in the past two weeks, traders' behavior has exhibited emotions of exhaustion, despair, and surrender. As the trading volume of major cryptocurrencies continues to decrease, even during minor price rebounds, it usually indicates a weakening enthusiasm among traders. In this situation, traders become more cautious, indicating that they may not believe the current upward trend can be sustained.

Furthermore, the shrinking trading volume during a minor rebound may be an early sign of waning market momentum. If there is a lack of strong buying support, price rallies may quickly lose momentum as there is not enough capital inflow to maintain the upward trend. This may suggest that any rebound is only temporary, and the price still faces the risk of another decline.

A reduction in trading volume during a slight rebound does not necessarily directly constitute a bearish signal, but trading volume reflects the market participation of retail and institutional traders. If both are waiting for the other to drive market growth to take the next step, the market may stagnate, showing a low volatility or even a slight downward trend. For a healthier, more sustainable market recovery, bulls usually hope to see price and volume increase in sync. Until trading activity significantly picks up, market sentiment may remain cautious."