Bitcoin Faces Challenges As Fear Dominates Market Sentiment

September 4, 2024

The Crypto Fear & Greed Index has taken a sharp turn from “Greed” to “Fear” this week, plummeting from 55 to 26 as Bitcoin’s price slipped below $58,000.

This shift reflects the growing concerns among investors and traders about Bitcoin’s current market dynamics.

One of the key reasons for Bitcoin’s struggle to reach new highs is the large number of traders who bought into the cryptocurrency between $61,700 and $70,500. With nearly 7 million addresses acquiring Bitcoin in this range, many are now at a loss.

As a result, there is consistent selling pressure whenever Bitcoin approaches these levels, as traders look to break even and exit their positions. This sell-off behavior is creating a significant resistance barrier for Bitcoin.

Additionall, the Exchange Volume Momentum indicator has shown a sustained drop in on-chain activity related to exchanges, signaling lower investor interest and decreased network usage. This decline in momentum is further weighing on Bitcoin’s ability to gain traction and push past the current resistance levels.

Compounding the situation, Bitcoin miners sold 2,655 BTC over the weekend, worth approximately $154 million, adding to the downward pressure on the market.

Despite this, there was a notable spike in the Bitcoin Taker Buy/Sell Ratio on HTX Global, indicating a surge in aggressive buying and hinting at potential upward momentum in the near future.

Whale Dumps Bitcoin As Market Suffers From Selling Pressure 

Adding to the market’s uncertainty, a whale who previously dumped $467 million worth of Bitcoin in July has recently withdrawn another 1,000 BTC ($57.4 million) from Binance, just 20 minutes ago, at the current bottom price. Over the past four days, this whale has withdrawn 2,000 BTC, totaling $117 million, at an average price of $58,525.

Meanwhile, Bitcoin spot ETFs experienced a net outflow of $277 million last week, with significant outflows from Ark Invest and 21Shares’ ARKB ETF and Grayscale’s GBTC, further reflecting the cautious sentiment in the market.

As Bitcoin grapples with these challenges, it will require significant momentum and a shift in market sentiment to break through the current resistance levels and resume its upward trajectory.

Disclosure: This is not trading or investment advice. Always do your research before buying any cryptocurrency or investing in any services.

Follow us on Twitter @themerklehash to stay updated with the latest Crypto, NFT, AI, Cybersecurity, and Metaverse news!

Image Source: kebox/123RF // Image Effects by Colorcinch

About The Author

Will

Will is a News/Content Writer and SEO Expert with years of active experience. He has a good history of writing credible articles and trending topics ranging from News Articles to Constructive Writings all around the Cryptocurrency and Blockchain Industry.