Cryptocurrency Market Still Greedy Despite Bitcoin’s Collapse to $94,000, Is a Recovery Coming?

You can say that the cryptocurrency market is maintaining its confidence despite the Bitcoin price falling dramatically to $94,000. Although the price action suggests otherwise, this confidence is highlighted by various predictions from cryptocurrency analysts on social media and on TradingView, which include several cryptocurrencies.

Amid falling prices and market optimism, the cryptocurrency market’s Fear and Greed Index continues to point to greed, leaning toward the idea of ​​a temporary decline before a broader recovery occurs.

Bitcoin price collapse halts upward momentum

The cryptocurrency industry has shown largely bullish momentum throughout 2024, with several cryptocurrencies reaching new multi-year highs. Bitcoin has led the momentum, breaking its 2021 all-time high of $69,000 in mid-2024 to… Eventually break above The psychological level of $100,000 debuted on December 5.

Related reading

However, Bitcoin’s price movement since crossing the six-figure price threshold has been mostly flat Full of corrections. Although it peaked at $108,135 on December 17, price declines have taken the spotlight over the past 12 days or so. It is worth noting, Bitcoin has corrected to its lowest level Of $ 92,600 in the last seven days, essentially resulting in A series of declines among other cryptocurrencies Stop the upward momentum.

Bitcoin’s decline surprised many cryptocurrency traders, considering its strong rise in recent months. Analysts attribute this correction to profit-taking by a small number of long-term shareholders and a temporary slowdown in market activity.

Cryptocurrency market sentiment remains in a state of greed

Although prices have dropped recently. HODLing trends suggest The cryptocurrency market is still on track to maintain its rise until 2025. This sentiment is reflected in the Fear and Greed Index, which is still hovering in the greed zone, indicating confidence among investors. The index is derived from a range of key metrics, including market volatility, trading volume, social media sentiment, Bitcoin dominance, Google search trends, and surveys. Each component is carefully weighted to measure the market’s psychological state.

Related reading

At the time of writing, the Cryptocurrency Fear and Greed Index, according to To the alternative.me website, At a reading of 72, it is at the threshold of greed. This conveys investor confidence across various market indicators and indicates that traders are viewing the decline as a buying opportunity rather than a reason to panic.

These feelings of greed are conveyed Through some buying trends Across prominent cryptocurrencies. For example, on-chain data from cryptocurrency analytics firm Santiment shows that Dogecoin whales bought more than 90 million DOGE tokens in the past 48 hours. With this in mind, analysts are optimistic about a broader market recovery in the coming weeks. Technical indicators point to a Bitcoin-led recovery if it can continue to hold above the support levels around $92,000.

At the time of writing, Bitcoin is trading at $94,400, and has fallen 12.8% since reaching $108,135 on December 17. according to Cryptocurrency analyst Ali Martinez, such corrections (between 20% and 30%) are the best thing that always happens to Bitcoin in every bull cycle.

Featured image created with Dall.E, chart from Tradingview.com