Bitcoin (BTC) and altcoin traders are going through a tense period as a common sentiment indicator points to “fear” in the market.
According to the Crypto Fear & Greed Index, crypto traders are experiencing such a timid period for the first time since April 2020.
Similar to March 2020
The fear and ambition index uses a number of factors to determine the dominant sentiment among market participants and therefore where the market is likely to go.
Price fluctuations can cause significant changes in this data. Just four days ago, on May 10, the index was measured at 72/100. At that time, the sensitivity had reached the level of “ambition”.
As of Friday, Tesla’s discontinuation of accepting Bitcoin for allegedly damaging the environment and the fact that leading cryptocurrency exchange Binance is on regulators’ radar has deeply affected the market structure. At the time of writing this article, Fear and Ambition data was measured at only 26/100. Although this value is in the “fear” zone, it is also on the edge of the “extreme fear” level.
In the last period when the index was so low, the BTC / USD parity reached a low of $ 3,600.
On the other hand, as Cointelegraph reported, Bitcoin seems to have survived the hurricane this time around. Despite the sellers’ move to cashback, the largest cryptocurrency seems to have performed “very well”.
Popular trader Scott Melker said, “If the stock markets can fend off a global epidemic, I’m sure Bitcoin will handle a tweet.” summed up.
Bitcoin trying to get back to its “way as usual”
While analysts have spoken positively that the recovery process for Bitcoin is about to begin, some large altcoins have managed to avoid the bearish process.
“Elon’s downtrend seems to be getting better,” statistician Willy Woo told his Twitter followers on Thursday. said.
Woo pointed out that traders probably increased their purchases in dips or started buying again after selling.
On the other hand, the amount of stablecoins in the exchanges continues to rise and has a large liquidity pool to return the uptrend to the cryptocurrency markets.
Rafael Schultze-Kraft, co-founder of on-chain analytics resource Glassnode, stated that the financing rates had gone from bottom to the previous process.
In the table he shared, he stated that the funding rates were positive again, while the long positions exceeded the short your interpretation made.