Crypto market sentiment remains in the “Extreme Fear” zone even after a slight recovery of Bitcoin
A market sentiment indicator popular with crypto traders and enthusiasts has hit another 2021 low with a value of 10, while Bitcoin rises above the $30,000 value.
The Fear and Greed indicator measures emotions and sentiments from different sources and compiles them into one value that allows traders to evaluate current tendencies on the market.
After a large sell-off on the crypto market, Bitcoin has opened in the green zone today. It rose back to the strong support price of $30,000. Some market participants think that Bitcoin’s move was caused by the upcoming “B-Word” conference that will include a discussion between Elon Musk, Jack Dorsey and Cathie Wood.
But even the occurrence of what seems like a “bullish event” did not move the index any higher. Most likely, market participants are following a general downtrend on the Bitcoin chart, according to moving averages cross and formed trendlines.
But the new lows on the indicator might also be good news for the market. If we look at the market-to-index correlation, we will see that the last time the Fear and Greed index hit values close to 10 was March of 2020. That was when the previous bull run began.
Three months after every run to the extreme lows on the index, Bitcoin experienced a short-term bounce. We will not know if this is the case with the bounce until we see further price movement on the daily BTC chart.