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Bitcoin Fear and Greed Index indicated a striking contrast within the market’s sentiment dynamics. As of press time, the index stood at 78 denoting “Extreme Greed.” While BTC price saw some rangebound momentum.
The index has been consistent over the past several days and aligned with last week’s reading of 76, indicating a sustained period of extreme greed. Also maintained the same level over the past month.
Despite the Bitcoin market experiencing a decline, this persistent sentiment of greed, traditionally suggested a potential for either a significant pullback or a period of market consolidation.
The high index value in the face of downward price action could hint at an overly optimistic market condition eliciting wary, as such sentiment extremes often precede market volatility or corrections.
This dissonance between the market sentiment and the actual market price movement signaled that investors remain hopeful or speculative about future gains, despite recent price drops.
Therefore, the market could be due for a stabilization phase, where prices could adjust to reflect more sustainable values, aligning sentiment with actual market performance. This suggested BTC could potentially chop or pullback.
Leveraged Short Positions at $100K
The “Candles Exhaustion” over a short period, marked by a 5-minute time frame highlighted minor fluctuations in price.
The main chart area displayed BTC price’s recent struggle to maintain upward momentum, with price around $95,561, suggesting a possible consolidation or preparation for a breakout.
The Liquidation Maps” on the upper right, showed a high concentration of cumulative shorts nearing $30 Million.
This accumulation indicated a significant number of sell positions that could be liquidated if the price were to increase sharply.
A sharp price rise to just over $100K could trigger these liquidations, likely leading Bitcoin to a short squeeze—a rapid increase in price as sellers rush to cover their positions.
Analysis across multiple exchanges suggested an alignment in the trading sentiment and liquidation points around $100K, supporting the potential for Bitcoin to spike to this level and above, mainly to liquidate short positions and trap sellers.
BTC Price: Historical Range Around Previous ATHs
Bitcoin continues to hover around the price levels, especially the $100K mark—a psychological and previously attained all-time high.
As of press time, BTC price saw a minor dip, quickly rebounded as part of its tendency to “chop” around these levels before stabilizing or breaking out. This chop could continue for a short while.
Historical patterns suggested that after sell-offs and subsequent consolidations, Bitcoin often experiences substantial breakouts above previous ATHs, just below where it was chopping.
This was reminiscent of its 2020 behavior when it surpassed the $20K mark, initially dropped, chopped and then surged to higher levels.
BTC price’s present situation near the $100K level appeared to mirror this behavior, indicating that a similar breakout might be forthcoming if historical trends hold true.
Given this pattern, the market could witness a stabilization phase where alts could start to outperform if BTC price maintains its upward trajectory.