Bitcoin hit its all-time high of nearly $ 65,000 on April 14, 2021, just over a month ago. However, in the last 10 days, the price has fallen sharply from the $ 50,000 mark and even hit $ 30,000 last Wednesday.
Bearish sentiment affected the entire crypto market as altcoins suffered even more: ETH, which saw its all-time high of $ 4,400 just 11 days ago, fell below $ 1,800 earlier today, before a slight correction at the time of this writing.
Where is the bottom of this ongoing crypto bloodbath? No one knows, but it might be worth keeping an eye out for the following bullish signals.
Crypto Fear & Greed Index: Remember April 2020?
The crypto fear and greed index is now at levels not seen since April 2020, which is around the time the last crypto market crash occurred, pushing BTC below $ 4,000, losing more than 50% in two days at the height of the “Black Thursday”.
Looking back, it was a great time to join, but it wasn’t necessarily obvious at the time. These days, Bitcoin has fallen more than 50% from its high of around $ 65,000 to $ 30,000 on Wednesday – is the index still right, and is this crash a blessing in disguise for people with stable coins on the sidelines?
here are a few times in the past 2 years fear and greed was less than 15.
do what you want with it. pic.twitter.com/TlLe7B7Q5C
– Bluntz (@SmartContracter) May 23, 2021
S2F model: band less than $ 30,000
Likewise, the stock to flow model (S2F) indicated that BTC is expected to rebound higher to the $ 30,000 mark given its stage in the cycle. The S2F model treats Bitcoin as a commodity (given that it has a fixed supply and limited issuance, similar to gold) and therefore takes into account the circulating supply and the speed of production to determine the scarcity and therefore the price.
IN BITCOIN’S SHORT HISTORY, the S2F model and the 4-year cycle have proven to be reliable. As declared by PlanB, the creator of the model: The continuation of this crash in the coming weeks (effectively the end of the bull cycle) would invalidate the S2F model and the 4-year cycle model, which have so far been strong – many analysts predict that it is not yet time for things to deteriorate.
S2F is currently plotting the lower band at $ 30K which is this week’s current low.
On-Exchange Stablecoins at ATH, pending?
The amount of stablecoins on exchanges is at an annual ATH – Lex Moskovski opine that there are “a lot of balls waiting to be deployed from the sidelines”.
Of course, this could just be a function of a large number of new entrants to the cryptocurrency ecosystem, but it most likely means that the big players are getting ready to make some big buys.
Additionally, John Bollinger, the creator of the Bollinger Bands Indicator, believes that BTC could be close to a local double bottom.
All of these indicators come together and paint a better picture of Bitcoin’s immediate short-term potential than the market would suggest. After the waves of relentless bearish moves of the past few days, it may be time for BTC to take a breather as RSI indicates that we are heavily oversold.
Vaporware Altcoins saignements – BTC Dominance Rising
Clearly altcoins have more to worry about – Bitcoin’s dominance has hit a local low at ~ 40% and is trending steadily upward (currently at 47%). It will likely recover even more as the market sheds the excess weight that was added by the vaporware coins fueled by the altcoin mania bubble.
Thousands of new coins (mostly in the form of BEP-20 and ERC-20 tokens) have been created in hopes of emulating the success of even older coins such as Dogecoin. While several of these coins brought in market caps in the millions, it was evident that something of this magnitude could never be sustainable once given their lack of fundamental utility.
As such, it’s fair to assume that smart money started the transition from low-cap altcoins to Bitcoin, the inevitable king of cryptocurrencies.
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