What does Bitcoin have on its plate when the Fear and Greed Index dumps to serious lows?

The biggest cryptocurrency in the world, Bitcoin, is suffering from a serious sell-off, leading to intensive market panic. The Fear and Greed Index has dropped into the “extreme fear” situation. The metric shows that this is the lowest possible position since the COVID-19 crash.

Bitcoin began following its longest downtrend streak in history. The cryptocurrency lost almost $40,000 in value from its all-time high in the past months. It recently closed the next nine weekly candles in the red.

When the market experiences such significant price volatility, analysts start coming up with forecasts about what will happen next. The renowned derivatives trader Peter Brandt claimed bitcoin is likely to sink much more, indicating a short-term bottom of slightly over $13,000, based on a recent double top that BTC established.

Will Clemente, another well-known analyst, sees this slump as a buying opportunity because the dormancy flow statistic has dropped to its lowest level ever. Social media is continuously encouraging investors to buy the dip.

Lowest reading on dormancy flow EVER.

Either this signal is broken and this time is different or this is one of the best accumulation opportunities for BTC ever. pic.twitter.com/hDThFVllHj

— Will (@WClementeIII) June 14, 2022

BTC stayed around $30,000 for a time before plunging again on Friday. The weekend, as well as the start of this week, brought more discomfort. As a result, bitcoin fell to around $20,000, its lowest level since December 2020.

Bitcoin Fear and Greed Index shows extreme fear

This largely bearish tendency, as projected, resulted in a major shift in investors’ beliefs and perspectives on the market. The Bitcoin Fear and Greed Index — a statistic that measures general attitudes by assessing many types of data, such as volatility, surveys, social media comments, and more – is the best example of this.

It displays the final results on a scale of 0 (severe fear) to 100 (extreme greed). Since the beginning of May, the Index has been stuck in the “extreme fear” zone. In the last two days, the measure has dropped once again to 7 – the lowest level since the COVID-19 epidemic.