Even as bitcoin holds near $80,000, investor sentiment remains cool, but the mood could instead be an early signal of a bull market, an analysis showed.

On Oct. 28 local time, blockchain outlet Bitcoin Magazine said software engineer Michael Sullivan, author of “Bitcoin Sentiment Weekly,” focused on the gap between prices and investor sentiment. He judged that investors’ expectations have not spread even as bitcoin prices stay elevated, resembling a feature seen early in a “disbelief rally.”

He cited language-based investor sentiment data. Sullivan said excitement, conviction and the urge to buy evident in investors’ language have weakened sharply, at a level similar to 2015. He also rated the market’s muted reaction after bitcoin corrected from $86,000 to around $81,000 that day as a signal supporting the possibility of further strength.

A “disbelief rally” refers to a price rise even as investors are not convinced of the uptrend. Sullivan saw the current market as closer to a phase marked by a lack of conviction and fatigue than an overheated stage where traders actively chase rising prices. He also pointed to frustration among short-term holders as a clue that reflects the mood.

Differences in sentiment by investment approach were also discussed. Sullivan covered sentiment when buying near an all-time high and the dollar-cost averaging, or DCA, approach of investing a fixed amount regularly. Even at the same price level, the burden and expectations investors feel can differ depending on timing and method. That is why frustration among short-term holders needs to be examined separately from whether the overall market is overheated.

As a theme that could lead the next bull market, he cited the potential to combine bitcoin and artificial intelligence. Sullivan saw deflationary pressure driven by AI as something that could strengthen the investment rationale for bitcoin. In discussions with the outlet, a trend in which bitcoin and traditional finance grow together was also mentioned.

The analysis focused on the point that it is difficult to judge whether the market is overheated based on price levels alone. Sullivan cited the fact that bitcoin is holding near $80,000 even as investor heat has cooled as a basis for reading the possibility of future strength.