The Fear & Greed Index has just begun to show some of its lowest levels. Negative sentiment has reached yearly lows, signaling the start of a downward trend.
Extreme Fear is Visible
Investor mood has shifted negatively, a common indicator of a declining market. Various indicators indicate that the market is presently in great fear, implying that investors are hesitant to join the field. The crypto Fear & Greed Index’s most recent readings indicate that the situation is worse than imagined.
The indicator is currently at 10, which has not been reached in the previous six months. It’s the lowest since January, when the market was still reeling after the fall on December 4. The long-term fall that followed was eerily comparable to what is currently taking place.
Even though the market has recovered from its early losses, it remains bearish. Bitcoin is now trading at over $30,000, while Ethereum is trading at around $2,000 at writing. This does not change that investors are still focused on the market’s direction.
The market is on the mend
The early morning recovery on Monday is encouraging, but it is unclear whether it will sustain. Because of their superior position, the bears have gained ground and are more likely to draw down again.
Bitcoin continues to trade below the 50-day moving average despite the market’s recovery. It’s a seller’s market, and it’s still susceptible to a rebound.
Bitcoin’s support is at $28,108, which implies that it will most certainly test its pre-weekend lows if it falls below this level. Other indicators are also pointing to a selloff, which doesn’t help.
As many funds enter the market, the current recovery trend in the bitcoin market must continue. Even though cryptocurrencies are presently trading at low levels, they are still vulnerable to more losses unless buyers increase their buying activity.
The inflow of $60 billion in 24 hours
Bitcoin’s transition to green has resulted in a huge gain in overall market capitalization. According to market tracker statistics, the total value of the cryptocurrency market has increased by more than $60 billion in just 24 hours.
On May 30, the total market capitalization of cryptocurrencies rose from $1.21 trillion to $1.271 trillion. The market as a whole gained 4.64 percent in the previous day.
In the last 24 hours, the total market volume of all cryptocurrencies was $68.42 billion, up 39.60 percent from the previous day. DeFi, on the other hand, has a volume of $6.89 billion, accounting for 9.92 percent of the overall 24-hour volume. In addition, stablecoins are currently trading at $60.82, a gain of 87.62 percent.
Will LUNA be resurrected?
Terra’s fans voted last week to keep the luna token alive, but not the project’s stablecoin, terraUSD. On the other hand, Experts believe Terra’s odds of success are slim. To keep its position as the premier platform for decentralized apps, it will have to compete with other blockchains such as Solana and Ethereum.
Terra distributes Luna tokens to people who previously possessed UST and Luna classics through an airdrop. This cash will be used to reimburse those who have lost money due to the company’s failure. This effort, however, may not bear fruit because there has been a significant loss of faith in the enterprise.