How does retail investor sentiment influence the price trend? Analysts warn of the FOMO trap

【Crypto World】At the beginning of the year, social media sentiment in the crypto market was booming, but this excitement concealed many risks.

Analyst Brian Quinlivan from blockchain analytics platform Santiment recently pointed out an interesting phenomenon — despite prevailing fear in the market, social media data shows that participant sentiment is quite positive, even somewhat overenthusiastic. In his recent analysis, he stated, “The current positive sentiment is somewhat concerning,” but also admitted that this might just be a normal rebound after the holiday.

However, Quinlivan specifically warned of a dangerous signal: if Bitcoin rapidly surges to around 92000 USD, retail investors’ FOMO (Fear of Missing Out) could flood in on a large scale. He believes this price level is critical because once this happens, it will be clear whether retail investors are genuinely optimistic rationally or just chasing the rally. “If they are just following the trend because the price is rising, then that’s a problem,” he said.

This actually reflects a historical pattern: retail frenzy in the crypto market often occurs near all-time high prices or cycle tops. And it’s always the same — the higher the market excitement, the sharper the subsequent correction. Although January traditionally performs well, data indicates that the market still shows fear signals. Whether retail investors can remain rational and avoid FOMO at the top directly affects how far the subsequent trend can go.

Ultimately, what Santiment is saying is one thing: you need to be cautious, stay a little pessimistic, and also have a bit of impatience — because only then can you avoid being hijacked by market sentiment.