As prices struggle, the crypto market has fallen back into “extreme fear”
The crypto market continued to struggle after losing momentum after the last rally. In the last lap of this year, although the price of cryptocurrency was much higher than this time last year, the overall market performance was poor. Nonetheless, some interesting trends emerged as the market crashed and prices stagnated at this time.
The Fear and Greed Index shows that market sentiment is once again extremely negative. With the prices of top assets such as Bitcoin and Ethereum falling below important support points, market sentiment fluctuates greatly, but most of them are still in a negative state. This time, market sentiment dropped to the “extreme fear” zone.
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The crypto market is immersed in fear
The crypto market was in fear territory for most of December. The market price this month is not the most favorable, and investors are still very cautious when entering the market at this time. However, others saw this as a buying opportunity, as in the case of MicroStrategy, which purchased an additional 1,434 BTC, bringing its total holdings to 122,480 BTC.
After the turbulence ended in November, the total amount of the month showed neutrality in terms of emotions after the original good start of the month. As Christmas approaches, this situation has spread to December.
Market goes into extreme fear | Source: alternative.me
Yesterday, the Fear and Greed Index reached a peak of 29 on the chart, putting the market in the fear zone. This is an increase from last week the market spent a long time in extreme fear. Today, market sentiment has once again entered the extreme fear zone, with a low of 23 on the chart.
The index is so low that the market has low buying pressure and high selling pressure. The sell-off of various digital assets is still in progress, and the prices of these assets have fallen to a loss. As the market enters the weekend, which is usually characterized by low volatility, can the market escape its extreme greed?
Bitcoin and Ethereum suffer losses
Bitcoin caused a sensation in the market when it hit an all-time high of just over $69,000 in early November. As Ethereum is approaching the $5,000 mark shortly after, this puts the cryptocurrency market into an unforgettable bull market. But this will only be short-lived, because the downtrend will begin soon after.
For Bitcoin, the digital asset lost as much as $10,000 in one day, causing it to drop to a low of $40,000. On the other hand, Ethereum has persisted for a while, but succumbed to the downward trend in time.
After failing to stay above that price point this week, Bitcoin is currently trading at a price well below $50,000. Ethereum is currently trading at less than $4,000, which is a key support point for digital assets. At the time of writing, Bitcoin is trading at $47,141 and Ethereum is trading at $3,826.
Crypto total market cap at $2.16 trillion | Source: Crypto Total Market Cap on TradingView.com
Featured image from Bitcoin News, chart from TradingView.com