Despite being trapped within a range, the overall sentiment towards Bitcoin (BTC) in the long run remained optimistic. However, the data from Tether revealed a significant decrease in stablecoin inflows to exchanges.
Market participants, both traders and investors, exhibited caution in entering the market, a response that can be attributed to the recent price movements.
The pressure on Bitcoin buy/sell dynamics displayed a decrease in buying pressure over the last couple of months.
The market sentiment has also lost its steam, dropping back to levels observed in September and October after failing to uphold the gains made in November.
Bitcoin Fear and Greed Index Hits 4-Month Lows
By taking into account various factors like price trends, volatility, social media engagement, and BTC’s dominance, the Bitcoin Fear and Greed Index acts as a barometer of market sentiment.
Following the significant surge post the U.S. Presidential election, the sentiment had reached new heights.
Previously, during the rally in March 2024, the index consistently recorded values of 80 or higher. This trend started to shift towards the end of April. Similarly, the enthusiasm seen in November started to fade away a little over a month later.
This downward trend has not shown signs of a complete turnaround yet.
Analysis of the weekly chart revealed a firmly bullish pattern in BTC despite the erratic swings in sentiment.
Despite the gloomy economic forecast in the U.S. markets and the volatility caused by trade tariffs in some markets, Bitcoin managed to hold its ground around the $92k range bottom.
While there might be a potential drop to the $88k-$90k range in the upcoming weeks, this dip could offer a chance for buyers. HODLers are advised not to succumb to panic, at least not at this point.
Bitcoin did not endure seven months of consolidation within a descending channel in 2024 just to make a 60% surge and then fade away.
It’s challenging to be certain, but most on-chain metrics do not indicate that a peak has been reached yet.
Disclaimer: The views expressed do not constitute financial, investment, trading, or any other form of advice and should be regarded solely as the author’s perspective.