Fear arose as a consequence of news that the Federal Reserve is reducing its balance sheet or intends to do so after announcing that it would begin tapering later this year, causing markets to plummet. Indeed, the collapse occurred immediately after the release of the minutes from the December meeting of the Fed. The government declared in 2022 that it would gradually reduce its $8.3 trillion balance sheet after embarking on a record asset-purchasing spree in 2020 when the coronavirus epidemic first emerged.
Bitcoin market sentiment
Generally, it was also somewhat predicted that Bitcoin would lose $46,000 since the flagship digital currency had been pounding that support level on several occasions before. As a result of the most recent decrease, the Bitcoin Fear and Greed Index has fallen to 15, its lowest point since July 21, 2021. The Bitcoin Fear and Greed Index, which gauges the overall mood of the Bitcoin community toward the world’s most valuable cryptocurrency, has now descended into the realm of “Extreme Fear.” Noteworthy, the Bitcoin Fear and Greed Index measures investor sentiment toward Bitcoin at a particular time, with values ranging from 0 (“Extreme Fear”) to 100 (“Extreme Greed”). That is accomplished by the collection of data from many sources, such as cryptocurrency price fluctuations, surveys, online activity, among others.
Whats next for Bitcoin?
With Bitcoin currently trading at $43,193, it is down 7% on the day and roughly 37% from its all-time high of $68,000 achieved less than months ago on November 10. Leading cryptocurrency market analyst Michael van de Poppe explained that $42,000 is the crucial support zone for Bitcoin to hold while revealing that reclaiming $46,000 would be a trigger of continuation happening, he said: He added: It appears that although Bitcoin is down-trending, hitting that higher time frame support is what investors will be looking out for to see whether BTC can sustain $42,000 and see an upwards move back up to $46,000 in the coming days. Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
