In just a month the Fear & Greed Index rose from 10 to an extreme greed reading of 79 points. The last time the index was at such levels was in mid-April, when Bitcoin reached a historical high of $65,000.
Will the market rise, or does it need a correction? We analyse price levels of Bitcoin and Ethereum on the cryptocurrency exchange Bybit.
BTCUSD
On August 23 Bitcoin tested the important psychological threshold of $50,000 for the first time since May 15. In March–April, this level served as support during Bitcoin’s impulsive rise from $50,600 to the all-time high of $64,900. A break below $50,000 accelerated the decline to the May low of $29,900.
Holding above the $50 000 level could signal a move higher than the previous all-time high. This would occur if the bulls close the weekly candle on the weekly BTCUSD chart above $50,000. Until then, the current Bitcoin rise can be seen as part of a correction in the bearish trend.
ETHUSD
Ethereum is testing the resistance at $3,360, which provided support during the rally toward an all-time high of around $4,400.
If it sustains above $3,360, the asset will gain support to continue rising above the previous all-time high.
Conclusions
Bitcoin and Ethereum have approached the psychologically important levels of $50,000 and $3,360. They provided support as assets moved toward all-time highs — $65,000 for Bitcoin and $4,400 for Ethereum.
The high level of greed in the crypto market hints at a possible correction. However, the market could stay in such a state for several months and remains far from the maximum greed reading of 95 points.
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