The cryptocurrency market is experiencing turbulence with Bitcoin (BTC) hovering around $109,000, struggling to find strong support. The crypto fear and greed index has dropped to 29, signaling a shift towards "extreme fear" among investors. Are we heading towards a deeper correction ?
According to data from CoinGlass, the crypto Fear and Greed Index has plunged 16 points in a single day, dropping to 29. This places the market firmly in the “fear” category. This indicator reflects crypto market sentiment by weighing investor fear and greed. The lower the score, the more significant the concerns in the market.
This level hasn’t been seen since last April, when the announcement of potential tariffs by Donald Trump triggered significant anxiety among investors, leading to substantial corrections across the crypto market. Historically, such low levels often coincide with the end of correction phases. Some investors view this as an opportunity to enter the market.
Federal Reserve Chairman Jerome Powell recently warned about risks associated with interest rate cuts, once again highlighting uncertainty about inflation. This has created doubts about additional rate cuts this year, which would normally inject more liquidity into the markets.
Not only Bitcoin, but also Ethereum (ETH) have experienced a slowdown. The second-largest cryptocurrency has lost nearly 15% since the beginning of the week and has fallen below the $4,000 mark. Bitcoin itself briefly dropped to $108,780 last night before slightly recovering.
From a technical perspective, Bitcoin’s price shows signs of weakness. It’s currently trading below its 30-day moving average, an indicator often used as a benchmark for short-term trends. As long as the price fails to rise above this level, downward pressure will remain strong.
The crypto market appears to be going through a delicate phase, with investor sentiment at its lowest in months. While the situation is concerning in the short term, more seasoned investors might see this as a potential entry opportunity, as has been the case in the past during similar levels of market anxiety.
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Charles Ledoux is a Bitcoin and blockchain technology specialist. A graduate of the Crypto Academy, he has been a Bitcoin miner for over a year. He has written numerous masterclasses to educate newcomers to the industry and has authored over 2,000 articles on cryptocurrency. Now, he aims to share his passion for crypto through his articles for InvestX.
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