Bitcoin recorded over 3% gains leading into the afternoon of Wednesday, Sept 9, as the digital asset bounced back from yet another fall beneath the $10k mark.
Bitcoin’s recovery marked a stubborn refusal to remain below $10k range for the third time in five days, after the latest BTC price analysis correctly predicted that further dips to the $9k range were likely.
However, any long-term Bitcoin recovery may not necessarily be helped by the recent drop in traditional markets, which remain correlated to BTC. Meanwhile, the cryptocurrency market remains fearful as a whole, according to the Crypto Fear and Greed Index – something which could be a very good sign for buyers.
Bitcoin Records 3% Gains Within Range
The Bitcoin price climbed from $9,955 to $10,267 on Wednesday, amounting to 3.1% growth on a day when many altcoins also surged. Bitcoin’s market dominance remains near a 15-month low of 57% – nearly 13% lower than this time last year.
Bitcoin’s climb followed three consecutive dips to the high $9k range over the past five days, and Wednesday’s peak marked a continuation of a pattern which has seen BTC range-bound ever since its 17% plunge at the start of the month.
The failure of Bitcoin to remain uncorrelated to traditional markets, at a time when those markets were falling, is a blow to those who banked on such bonds being severed.
The S&P 500 and NASDAQ indexes fell by 3% and 4% respectively on Wednesday, taking weekly losses in the stock market to 10%. Uncertainty in traditional markets could be a sign of further volatility or stagnation for Bitcoin and the rest of the cryptocurrency market, assuming those bonds remain tethered.
Fear in the Crypto Market
Despite the ascendance of the altcoin market as witnessed by Bitcoin’s failing dominance rate, the overall sentiment in the cryptocurrency market remains fearful. Ethereum and its associated decentralized finance (defi) tokens led the market surge throughout most of 2020. But thanks to the collapse of yield farming sensation SUSHI, most of the defi marketplace took a serious hit during the most recent market drop.
Since then, defi tokens have bounced back the strongest – partially explained by the fact that they fell the furthest. Despite the notable bounce among defi altcoins, the Crypto Fear and Greed index still declares the cryptocurrency market to be at its most fearful in over a year.
The last time the market was deemed so fearful was in July 2019, as Bitcoin hit a double-peak close to $13,000, before descending right into the spring of 2020. The Crypto Fear and Greed index derives its rating from a combination of various data sources, including price volatility, market momentum, social media engagement, and market dominance.
While a “fearful” rating is indicative of uncertainty in the market, it also represents an opportune moment to capitalize on the hesitation of others. Conversely, a “greedy” rating, while indicative of a thriving bull market, often precedes a sudden correction.