Bitcoin Sentiment has dipped into extreme pessimism, suggesting a tactical or temporary low from which a BTC price bounce is likely, according to research firm 10x Research.
The firm’s proprietary “Greed & Fear” index, which measures market sentiment, plunged to a record low of less than 5 points. Readings below 10% represent extreme fear or pessimism, and above 90% signal green or overoptimism.
More importantly, the 21-day simple moving average of the index has fallen to 10%, a level that has consistently marked tactical lows over the years.
“Our own 10x Greed & Fear Index has been sitting near its lowest possible reading, and the slower average has now reached the 10% zone, a level that often marks a tactical low,” Markus Thielen, founder of 10x Research, told CoinDesk.
Peak pessimism does not necessarily signal an immediate end to the downtrend. While prices may continue to fall, the pace is likely to slow, with a tactical low in sight.
“Prices may still fall further, as we saw in March when the indicator bottomed out before bitcoin continued its slide into April. Yet bitcoin still staged a 10% rebound immediately after the initial sentiment level. With sentiment now near the bottom again, a similar short-term recovery is possible,” explained Thielen.
Bitcoin was trading near $84,800 at press time, after hitting a low of $80,880 on Friday, according to data from CoinDesk. Despite the cancellation, prices are still down 10% for the week and 23% for the month.
