Sentiment in the cryptocurrency market has fallen into “extreme fear” after the price of flagship cryptocurrency Bitcoin ($BTC) fell to $53,500 in a massive downturn that saw the space’s total market cap fall below the $2 trillion mark.
The Cryptocurrency Fear and Greed Index, which serves as an aggregate for investor confidence and attitude toward the market, fell to 22, signaling extreme fear.
The index hit a low around 6 when BTC fell below $18,000 in 2022 after the collapse of popular cryptocurrency exchange FTX.
These concerns stem from fears of a possible correction in September that could push bitcoin below the psychologically important $50,000 threshold. Arthur Hayes, former CEO of cryptocurrency derivatives trading platform BitMEX, recently revealed that he believes a price drop below $50,000 could happen this weekend.
Other analysts are notably bullish on the cryptocurrency, with cryptocurrency analyst MetaShackle on TradingView recently publishing an analysis showing that the cryptocurrency’s chart is forming an “absolutely massive” cup and handle pattern that could lead to a massive price rally.
According to the analyst’s post, there has “never been a formation like this in crypto history, and it will certainly be an incredible run to levels that will shock the world.”
A cup and handle pattern occurs when the price of a security declines and recovers to form a “U” shape, before seeing another slight downward drift that forms the handle. It is widely considered a bullish signal.
As CryptoGlobe has been reporting since mid-August, a specific cohort of Bitcoin investors, those who hold the cryptocurrency for shorter bond periods, have dumped 642,366 BTC, worth over $36.65 billion, into the market.
Earlier, Morgan Stanley revealed in a filing that it had increased its exposure to Bitcoin, disclosing a 2.1% allocation to BlackRock’s spot Bitcoin ETF, IBIT, in its institutional fund.
Featured image via Unsplash.
