Bitcoin Investor Sentiment Dropping, as Risk of Near Term Downside Increases
Bitcoin price recently witnessed a sharp decline that led it to test the $9,200 lows. However, the bulls gained strength and were able to push the price back into the $9,500 region. This price volatility has made the crypto vulnerable to witnessing a further decline in the coming sessions. Notably, buyers aggressively confronted this deal with buying pressure, confirming that it does have some important support within the lower $9,000 levels.
Some analysts have pointed out that the flagship cryptocurrency could witness some significant decline in the coming days and weeks if it fails to gain any further upwards momentum. Data regarding investor sentiment is also pointing out that BTC’s inability to break above the $10,000 level is causing some investors to anticipate further vulnerability.
At press time, BTC is down just below 3% at its current price of $9,398. This is a slight decline from its daily highs of just under $10,000 that were set over the past 24 hours. The BTC price has faced several rejections around the $10,000 level throughout several previous sessions. This is an indication that there is a strong resistance level for the flagship cryptocurrency at that region.
If the BTC price continues struggling to break above this resistance level in the coming sessions, there is the likelihood that the bulls’ momentum will begin to dissolve. In such instance, it could pave way for BTC to witness a massive decline in the near term.
One prominent pseudonymous crypto trader explained in a recent tweet that he is anticipating a drawback that will potentially lead BTC to lows in the $7,000 region.
$btc – failure to break down then I would setup short again from 96s – 97s
Taken 50% off initial short pic.twitter.com/ZztyZXvpTS
— TraderXO (@TraderX0X0) May 15, 2020
It seems like BTC’s present vulnerability is causing investor sentiment to degrade, a sign that shows that many are expecting to see further decline. According to a recent data from Arcane Research, Bitcoin’s “Fear & Greed Index” has dropped from the “Greed” phase to the “Fear” phase this week. The data revealed that the index is now down to 44 and the market is getting fearful after a volatile week.