The Fear & Greed Index for Bitcoin shows that traders are keeping their cards close to the chest, worried that the price may sink at the tail end of 2019. The market is dull and inactive and traders are apprehensive, not willing to commit.
Below $9,000 Bitcoin is Bearish: Analyst
With this level of fragility, a crypto personality and an influential trader, opines that the Bitcoin market is ripe for a short-term price reversal that may lift Bitcoin to $9,000.
“If we see a rally, understand that BTC remains in a BEAR MARKET DOWNTREND. Bear markets have rallies too, and BTC is in a technical bear market right now. Until we see some higher highs and higher lows, the trend is bearish and down, even if we see a rally to 9000.”
Despite the flood of optimism that may accompany the spring back, he is sounding a warning that it would need a lot of effort for Bitcoin bulls to reverse from spot rate and snap back to trend just five months before a market defining trend.
Bitcoin Futures Available at a Premium
The latest analysis of the Bitcoin Futures at BitMEX reveals that traders were buying contracts set for expiry at December and March 2020 respectively at a premium.
This means that, despite the prevailing market sentiment, traders are hopeful of better prices through to Q1 2020.
It must be noted that around this time last year, Bitcoin recovered and more than doubled after an energy-sapping crypto winter that saw many projects fold for lack of funds.
Reading from the Fear & Greed Index
From the index, evidence shows that traders are gripped by fear. But the situation was far worse on Aug 22, 2019. Then the index’s reading plunged to 5, pointing to extreme fear.
A few days later, BTC prices rallied, soaring to $10,900 before dropping in consequent months to spot levels.
On the flip side, at the height of the H1 2019 super rally, the market was excited and in a FOMO moment, the index’s reading reached 95. At that overextended level, BTC was overpriced and traders greedy for more. A few days later, prices dropped, popping the mini-bubble.
Bull Trigger at $7,800 Resistance zone
If conclusions are drawn out, Bitcoin prices may find support at spot levels. A rebound above $7,000 mark could spur further participation and lift prices to $7,900 as bulls reverse steep losses of late November 2019. In that likelihood, BTC may soar to Oct 2019 highs of $9,500.
Disclaimer The views, opinions, positions or strategies expressed by the authors and those providing comments are theirs alone, and do not necessarily reflect the views, opinions, positions or strategies of CoinGape. Do your market research before investing in cryptocurrencies. The author or publication does not hold any responsibility for your personal financial loss.
Dalmas is a very active cryptocurrency content creator and highly regarded technical analyst. He’s passionate about blockchain technology and the futuristic potential of cryptocurrencies and enjoys the opportunity to help educate bitcoin enthusiasts through his writing insights and coin price chart analysis. Follow him at @dalmas_ngetich