Bitcoin recently saw a slight price drop but got back to $40,100. The current support level is $40,000. Still, this price action is an alarm among the experienced traders. Senior financial analyst at FxPro, Alex Kuptsikevich, stated that “a signal to break the support will be considered a failure under the previous lows in the $38,000 area.”
On the other hand, the ability to develop reversal will reinforce the uptrend.
The Crypto Fear and Greed Index Shows Changes
The Crypto Fear and Greed Index, a platform that shows the overall market sentiment, recently flashed “extreme fear” among crypto investors. The reading was at 22, while last week’s “fear” was at 37.
This index works by generating a single number between one and 100, with one showing that the market is in a state of extreme fear and people are selling, and 100 indicating that the market is greedy – the people are buying.
According to many analysts, Bitcoin could see more unstable price action in the upcoming months.
During Q4 2021, Bitcoin was selling off hard, but at the start of 2022, it saw a period of directionless trading, Paul Robinson, strategist at DailyFX, said.
Robinson also noted that high volatility is likely to increase again as the middle of the year approaches. Historically, April has been a bullish month for Bitcoin and the crypto market.