Bitcoin : The Fear Index Reaches Record Levels — A Technical Rebound in Sight?

The Bitcoin market is going through a record pessimism phase, according to the Fear & Greed index by 10x Research. This signal, often associated with tactical lows, could it announce a technical rebound? Data analysis and implications for investors.

Bitcoin: A Greed & Fear Index at Its Lowest — What Does It Mean?

The Bitcoin Fear & Greed index, a key tool for measuring crypto market sentiment, has just reached a historic level of pessimism. According to 10x Research, the index dropped below 5 points, while its 21-day moving average fell to 10%. These rarely seen thresholds reflect extreme fear among Bitcoin investors.

This indicator, which oscillates between 0 (extreme fear) and 100 (extreme greed), is calculated from several factors:

• Volatility;
• Momentum; 
• Bitcoin dominance;
• Social trends. 

When it reaches such low levels, it means the market is in a capitulation phase, a phenomenon often followed by technical rebounds. Analysts highlight that in the past, these levels marked temporary lows before significant recoveries.

Extreme BTC Pessimism: A Signal for a Technical Rebound?

When the fear index plunges into the extreme fear zone, experienced investors often see an opportunity. Historically, levels below 10% have coincided with market lows, followed by notable rebounds. For example, after the 2022 crash, a similar level preceded a recovery of more than 50% within a few months.

However, this signal should not be interpreted as a guarantee. Indeed, the Bitcoin market remains influenced by macroeconomic factors such as geopolitical tensions or monetary policies. Thus, even if extreme pessimism may indicate oversold conditions, the possibility of a short-term continued decline should not be ruled out.

Bitcoin: Key Levels to Watch for a Rebound or a Continued Drop

The last two days have been marked by extreme volatility. Bitcoin briefly dropped below 81,000 dollars before recovering to around 84,000 dollars. For analysts, a sustained rebound would require reclaiming and maintaining the 85,000 dollar level, a major psychological and technical threshold. A daily close above this level could confirm a return of confidence and open the way to 90,000 dollars, then 95,000 dollars.

Conversely, a sharp break of Bitcoin below 80,000 dollars, especially if accompanied by high volume, could worsen the drop. In this scenario, the next supports are around 78,000 dollars, then 75,000 dollars, critical levels that could accelerate selling and prolong the downward trend. Recent data shows that massive liquidations around these thresholds have often triggered amplified movements.

The Bitcoin Fear & Greed index thus sends a strong signal of extreme pessimism, often a precursor to rebounds. Yet, in such a volatile market, nothing is ever certain. The key levels at 80,000 dollars and 85,000 dollars will be decisive in the coming days. And you, how do you analyze this situation? Do you think Bitcoin is ready to rebound, or will the drop continue?