Fear and Greed Index Drops to October Levels, Bitcoin Faces Turbulence by End of 2024
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Bitcoin Market Sentiment and Trend Analysis
Analysts point out that the sentiment and trends in the Bitcoin market are currently filled with uncertainty. When Bitcoin prices break through the downward trend line, bullish sentiment may be reignited, but if it falls below key support levels, bearish pressure may intensify. The sentiment in the cryptocurrency market is also experiencing fluctuations, reflecting the current state of hesitation in the market.
The Shift in Fear and Greed Index
According to the Cryptocurrency Fear and Greed Index, the current market sentiment has retreated to levels seen in October. The index stood at 65 as of December 30, down from the highs seen in November and early December. Although still in the 'Greed' zone, the change from the peak of 94 on November 22 indicates a shift towards a more cautious market sentiment. This shift aligns with Bitcoin's recent price decline, further reflecting the market's uncertainty.
Bitcoin Price Trends and Market Dynamics
Bitcoin reached a historic high of $108,268 on December 17, but has since seen a 13.5% decline, with current trading prices around $93,460. Meanwhile, the total market capitalization of the cryptocurrency market has dropped from $3.8 trillion on December 17 to $3.27 trillion on December 29, a decline of over 13%. This indicates that a market adjustment phase has emerged, and Bitcoin's price is experiencing significant volatility.
Market Hesitation and the Impact of Political Factors
Since November, the dynamics of the market have changed significantly. At that time, the results of the U.S. presidential election were announced, with Donald Trump winning the election, which initially sparked optimistic sentiments in the market. However, the recent price decline highlights the market's uncertainty and hesitation. Veteran trader Peter Brandt believes that Bitcoin's price trends may follow what he calls the 'Camel Hump Crash and Surge' pattern. This pattern describes the initial rise in Bitcoin prices, followed by adjustments, partial recoveries, a significant drop, and eventual rebounds. Currently, Bitcoin is in a consolidation phase between the downward trend line and key support levels, reflecting this potential market trajectory.
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