Crypto Investor Sentiment Turns Neutral as BTC Price Plummets Below $57K

The Bitcoin Fear and Greed Index shows crypto investor sentiment has turned neutral following BTC’s slump below $57,000.
According to data from Alternative.me, the fear and greed index sits at 54 for the first time in three months, signaling that crypto investors are neither fearful nor greedy amid the current market conditions.
Investors Harbor Neutral Sentiment
The last time investors harbored a neutral sentiment was on January 28, 2024, when the price of BTC hovered around $42,000. At the time, BTC was rallying, and the crypto market buzzed with excitement over the launch of the numerous spot Bitcoin exchange-traded funds, which U.S. authorities had greenlit over two weeks prior.
However, the current conditions of this market sentiment are different. Bitcoin has tumbled from an all-time high of $73,700 recorded in mid-March. After experiencing heightened volatility in the past weeks, the cryptocurrency took a turn for the worse yesterday, which continued today.
The fear and greed index determines the market sentiment by analyzing several factors, including bitcoin’s dominance, social media, market momentum, trends, and volatility. On a scale of 0 to 100, 0 indicates extreme fear, 50 signals neutrality, and 100 means extreme greed.
In the past weeks, investor sentiment has hovered around greed, occasionally spiking to extreme greed. Alternative.me revealed the sentiment was at 67 yesterday and 72 last week, indicating that investors have been greedy. Market participants were even more greedy last month, as seen in the index spiking to 79, a number that signifies extreme greed.
It remains to be seen which direction the crypto market will take in the short term: towards fear or greed. While another correction is possible, analysts expect prices to rise long-term, as they have always seen after the Bitcoin halvings.
Will BTC Plunge Further?
Meanwhile, bitcoin’s latest fall saw it drop below crucial support levels, with the crypto market losing more than $200 billion. Within roughly 36 hours, BTC has plummeted over 11% from $64,100 to $56,700, dragging altcoins and the rest of the crypto market. At the time of writing, BTC was still in the red but had recovered slightly and was trading at $57,200.
Analysts think BTC could plunge further before resuming its rally because there have been deeper corrections in previous bull market cycles.
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