The Bitcoin Fear And Greed Index Enters Moderate Territory

After its fall below $80,000, bitcoin is now bouncing back above $85,000. The fear and greed index is moving out of the extreme greed zone to more balanced levels, suggesting a possible return to bullish momentum.

The Bitcoin market sentiment evolves positively

Bitcoin has been undergoing a major consolidation phase since the beginning of March. After significant bearish pressure caused it to drop below $80,000, the queen of cryptos has started a significant rebound. It is now trading above $85,000, a level that reassures many investors.

This recovery is accompanied by a notable change in market sentiment. Axel Adler Jr., a recognized blockchain analyst and macroeconomic researcher, highlighted an important evolution in the fear and greed index of bitcoin.

This technical indicator, which synthesizes various data to measure the emotional climate of investors, shows clear signs of stabilization.

Specifically, the quarterly index (90 days) has fallen by about 22 percentage points over the past two months. This decline has moved it out of the extreme greed zone to reach more moderate levels, suggesting a gradual rebalancing of market forces.

Is the current BTC correction coming to an end?

If the index continues to drop an additional 10 to 15 points in the coming weeks, the market could find relative calm.

At the current pace, Adler estimates it will take between 4 to 6 weeks to reach this critical threshold. Once this level is reached, emotional fluctuations should significantly decrease.

A particularly encouraging phenomenon is already emerging. While the quarterly index continues its normalization, the 30-day moving average (monthly) has begun to form a local floor. This technical setup is reminiscent of that which marked the end of the last major correction when bitcoin hit $54,000.

This technical analogy is of great interest to investors. After this low at $54,000, bitcoin had a spectacular increase of over 107%, reaching its all-time high of $109,400. Crypto analyst Mags anticipates a similar scenario, with a new potential low at $76,600 before a significant rebound.

For this projection to materialize, Mags emphasizes the importance of the critical support located at 45 on the relative strength index (RSI). If this level holds, a 64% increase could follow, potentially propelling Bitcoin towards $128,000 – aligning with the Fibonacci extension level of 1.618 and establishing a new historical peak.

The current period remains crucial for the medium-term future of bitcoin, with technical signals gradually leaning towards a return of measured optimism.