Bearish Sentiment Grows as bitcoin‘s Growth Slows Down
The recent surge in the cryptocurrency market has led to high expectations among investors, especially for bitcoin (BTC). The value of bitcoin briefly surpassed $35,000, causing excitement among those who had invested in the cryptocurrency.
However, this increased optimism can be a bearish indicator, as it often leads to a price correction. This sentiment has been reflected in the recent sluggish growth of bitcoin over the past 24 hours.
Bearish Sentiment Around bitcoin Grows
According to CoinMarketCap, bitcoin‘s value has increased by over 12% in the last seven days and currently trades at $34,323.71 with a market capitalization of over $670 billion.
Although the price of bitcoin has been rising, its 24-hour trading volume has remained stagnant. This coincided with bitcoin‘s fear and greed index reaching a value of 72, indicating increased greed in the market.
The fear and greed index analyzes market sentiment and indicates the likelihood of a price correction. When the index surpasses 50, the chances of a price drop become much higher. With the index at 72 during this time, the possibility of a price correction for bitcoin appeared likely.
Furthermore, data from CryptoQuant showed that investors had already started selling their bitcoin holdings. BTC‘s exchange reserve was increasing, suggesting selling pressure on the cryptocurrency. Additionally, bitcoin‘s aSOPR was in the red, indicating that more investors were selling at a profit, potentially signaling a market top.
bitcoin Investors Must Practice Caution
Several technical indicators also point towards a potential price drop for bitcoin. The relative strength index (RSI) and the money flow index (MFI) were both in overbought positions, increasing selling pressure and the likelihood of a falling price trend.
However, bitcoin‘s Chaikin Money Flow (CMF) was still bullish, rating above the neutral mark, providing some hope for investors.
As investors navigate the volatility of the cryptocurrency market, caution is advised. bitcoin‘s recent slowdown in growth and the various indicators suggesting a potential price correction highlight the need for careful consideration and risk management.
While bitcoin‘s recent surge had investors optimistic, the bearish sentiment around the cryptocurrency has grown. The fear and greed index, along with other indicators, highlight the potential for a price drop. As bitcoin investors proceed, it is essential to exercise caution and carefully analyze market trends to make informed decisions.
### News source: ambcrypto.com