The Crypto Fear and Greed index has dropped below 80 for the first time since November 5th, 2020
It had more or less plateaued above this value for close to 2.5 months
A drop in the index could be the first signs of a Bitcoin and Crypto market cool-off
Bitcoin faces the weekly close that could see the crucial $30k support tested once again
The Crypto and Fear index has dropped below 80 for the first time since November 5th, 2020. At the time of writing, the Crypto and Fear index is currently at 79 after plateauing above 80 for close to two and a half months. Below is a screenshot of the current level of the Crypto and Fear index.
A Drop Could Signal a Bitcoin and Crypto Wide Cool-off
As earlier mentioned, the last time the Crypto and Fear index was below this level was on November 5th, 2020. Checking the Bitcoin chart, the latter date was when the $14k price ceiling was confidently broken and BTC went on to break its previous all-time high of $20k on December 16th.
The Fear and Greed index would go on to stay high till January 13th when it dropped to 78. January 13th is exactly two days after Bitcoin fell hard by over 26% to the crucial $32k – $30k support zone. The chart below of the Fear and Greed index further provides a visual cue of the current situation.
The drop below the 80 value could be the first signs of a Bitcoin and crypto-wide cool off. At the time of writing, Bitcoin is trading at $34,800 in what looks like a fierce battle to maintain the $35k price level as support.
Bitcoin is generally exhibiting a level of weakness that could cause a drop back to the $30k support zone during today’s weekly close. As is usually the case, the fate of all altcoins such as Ethereum and Chainlink is very much tied to the stability of Bitcoin. Therefore, if BTC loses this crucial support zone, altcoins will suffer a similar fate in terms of losing value as Bitcoin corrects.