Bitcoin (BTC) and crypto traders are more scared than ever in over six months as BTC price action remains stuck at $100,000.
Important points:
Bitcoin and altcoins have fallen to their deepest “extreme fear” level since March of this year.
Based on sentiment data, cryptocurrencies may be nearing a market inflection point.
Gold takes center stage from cryptocurrencies and stocks as the US government shutdown ends.
Wednesday’s Crypto Fear & Greed Index data confirms that traders are currently in the “extreme fear” zone.
Bitcoin and crypto market sentiment hits 7-month low
Bitcoin may still be trading in six digits with a market capitalization of $2 trillion, but the mood in the trading world could not be more bearish.
The Crypto Fear & Greed Index, which uses a basket of components to measure market sentiment, is currently at 15/100, its lowest level since early March.
This number even eclipses the height of panic over US trade tariffs, which saw BTC/USD hit a domestic low below $75,000 around Liberation Day in April.
“Less than 20? I’ve never seen this indicator this low,” trader and analyst BitQuant wrote in a reaction on X.
“Retailers should have already exited the market.”
BitQuant cited the lack of participation by small crypto investors, saying this is a feature that characterizes much of the current bull market.
Analytics platform Santiment has drawn similar conclusions in its latest research, suggesting a potential market turnaround as a result.
“When the crowd turns negative towards the highest market caps of assets, especially cryptocurrencies, it shows we are reaching a capitulation point,” the magazine wrote on Tuesday.
“When retailers fail to sell, key stakeholders pick up the coins that fall and drive up prices. The question is not ‘if’ but ‘when’ this will happen next.”
Santiment warned that “there is even a bullish/bearish ratio of social media comments” regarding Bitcoin itself, which he called “significantly lower than normal.”
Gold, not cryptocurrencies, supports US government reopening of economy
As such, crypto sentiment continues to diverge from stocks, with the traditional Fear & Greed Index remaining at 35/100 on Wednesday.
Related: “The Most Hated Bull Run of All Time?” 5 Things to Know About Bitcoin This Week
The end of the US government’s longest government shutdown in history had little impact on market performance, an event that was already priced in earlier this week.
Instead, gold and silver were in the lead, with the former topping $4,200 an ounce and eyeing a retest of all-time highs.
Comments, Trading Resources Covisi Letter said President Donald Trump’s plan to provide new $2,000 stimulus checks to Americans is fueling hopes for new liquidity.
“Momentum will pick up quickly if the $2,000 stimulus package materializes. Gold and silver are always the first to know.”
At the time of writing, BTC/XAU was close to its lowest level in over a year, according to data from Cointelegraph Markets Pro and TradingView.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk and readers should conduct their own research when making decisions.
