- Bitcoin price has been in a consolidation phase recently.
- Bitcoin’s fear and greed index has moved to the fear level.
- There are no signs of a bear market capitulation.
Bitcoin price has gone nowhere in the past few days as a somber mood has engulfed the crypto market. The BTC/USD price was trading at 17,040 on Thursday while the BTC/GBP was ranging at 13,777. Other cryptocurrencies have been under pressure as well.
Fear and greed index retreats
Bitcoin price has been in a consolidation phase recently as investors remain fearful about the crypto industry. This fear is mostly because of the elevated risks in the sector following the collapse of FTX, Alameda Research, and Genesis.
A clear sign of how worried investors are is the closely-watched crypto fear and greed index. Data shows that the index is in the extreme fear zone of 25. In most cases, Bitcoin tends to struggle to recover when fear is dominating the market.
Investors are broadly getting afraid. The fear and greed index tracked by CNN has moved from 63 to 57 in the past few days. This decline has coincided with this week’s clash of American stocks, with the Dow Jones and Nasdaq 100 falling for six straight days.
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A key concern among investors is the next actions by the Federal Reserve after the stellar economic data from the United States. These numbers revealed that the American economy was doing well as the unemployment rate remained at 3.7%. Another report by ISM showed that the services sector has expanded for 11 months straight.
Therefore, while the Federal Reserve has hinted it will slow the pace of rate hikes, analysts expect that it will lift above 5% in 2023. Bitcoin and other risky assets tend to underperform when the Fed is hiking rates.
Meanwhile, the number of Bitcoin stored in exchanges has dropped to about 2 million, down from last year’s high of over 3 million. This decline is a sign that some investors have shifted some of their coins to cold storage while most of them have sold them.
Bitcoin price prediction
The daily chart shows that the BTC price has gone sideways in the past few days. In this period, it remains below the important support level at $17,606, the lowest level on Friday 17th. It has also crashed below all moving averages while the Average True Range (ATR) has slumped. This is a sign that volatility has dried up.
Most importantly, the Bitcoin Wookalich Ratio has eased. This is an important tool that is derived from the NVT signal and is a tool usd to predict tops and bottoms. Therefore, the coin will likely have a bearish breakout in the coming days as sellers target the support at $15,000.
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