Predicting Bitcoin Cycle Tops with Social Volume: Insights from GameStop and GME

  • Is there a connection between GME’s surge and Bitcoin’s price movements?
  • Previous cycles have shown a correlation between the two

Bitcoin [BTC] broke through its immediate resistance level at $64.5k on May 15th, just two days following GameStop’s [GME] impressive 284% jump from the previous Friday. According to a recent update on X (previously Twitter), Santiment stated that the frenzy around GME had spilled over into the crypto realm.

Given the speculative nature of the cryptocurrency market, particularly in meme coins, this connection seems logical. To explore whether public sentiment can predict market highs and lows, AMBCrypto delved into further comparisons.

Social media buzz impacting short-term trends

GME Social volume and BTC price

Source: Santiment on X

In the short term, mentions of GME/AMC on social media did coincide with Bitcoin’s recent peaks and valleys over the past three days. However, it’s possible that these social trends aligned with market movements rather than predicting them.

On May 13th, Roaring Kitty emerged from a 3-year hiatus with a meme on X (previously Twitter). Additionally, on May 15th, the release of Consumer Price Index and inflation data came in below expectations, leading to an increase in risk appetite among traders.

GME Social volume and BTC priceGME Social volume and BTC price

Source: Santiment

GameStop’s social activity peaked in January and November of 2021, coinciding with significant events in the Bitcoin market. In January, after a price dip to $31k, Bitcoin surged, while November’s spike in social volume preceded a decline in BTC prices. Therefore, Santiment’s recent findings may hold some weight.

Traders and investors should monitor these metrics going forward for potential insights.

How does the altcoin market fare?

Altcoin Market CapitalizationAltcoin Market Capitalization

Source: TOTAL.3 on TradingView

The spikes in GME social mentions in January and November 2021 lined up not only with Bitcoin’s movements but also with the altcoin market’s capitalization. However, the recent surge in May 2024 did not correlate. Altcoins have been gaining market share since October 2023.

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In summary, the connection appears to be that an increase in GME social chatter strengthens an existing bullish trend in the crypto sector. Nonetheless, it doesn’t guarantee a new trend will be generated.

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