Bitcoin (BTC): Extreme Fear Returns Following Most Recent Price Drop
The Fear & Greed Index for Bitcoin, the leading cryptocurrency, has plunged back into “extreme fear” territory with 25 points out of 100.
This came after the cryptocurrency plunged to an intraday low of $58,134 on Monday on the Bitstamp exchange.
More than $123 million worth of long positions have been liquidated, according to CoinGlass data.
As reported by U.Today, Bitcoin endured a massive crash last Monday, collapsing all the way to $49,557 on the Bitstamp exchange. This was due to contagion from global stock markets. However, the leading cryptocurrency managed to recover in mere days in tandem with global stocks, reclaiming the $60,000 level on Thursday. In fact, the flagship cryptocurrency experienced its biggest rally since February 2022 on that day.
The recovery was mostly due to the resilience of institutional investors. BlackRock’s Bitcoin exchange-traded fund, for instance, did not see any inflows despite the market crash.
Still, Bitcoin bulls struggled to maintain their momentum, with Bitcoin failing to hold the $60,000 level. Last week, banking giant JPMorgan warned that there were no obvious bullish catalysts for Bitcoin that were yet to be priced in by the market. Its analysts pointed to the apparent vulnerability of equities, which might not bode well for crypto.
S&P 500 and Nasdaq futures remain flat at press time, meaning that Bitcoin’s recent bearishness is unlikely to be related to the stock market.
Recently, the cryptocurrency formed its first death cross of 2024, possibly indicating a bearish reversal. However, it tends to be a lagging indicator since it is based on past data.
