Crypto Markets See Wild Swings: Bitcoin and Altcoins Bounce Back
The past week has been a wild one for the cryptocurrency market. Both Bitcoin and other altcoins had losses at the start, but those losses were swiftly recouped on July 2 and 3. While the overall altcoin market has increased by 7.6% since June 23rd, Bitcoin has increased by 6.31%.
However, short-term holders took profits on July 4th, which resulted in fresh selling pressure. The imminence of the Trump-era tariffs‘ expiration date further exacerbates the uncertainty. Although trade agreements have been struck between the United States and nations like China and Vietnam, agreements with important partners like South Korea, Japan, and the European Union have not yet been finalized.
Greed Levels Rise in Crypto Market, but History Says No Immediate Crash
One possible explanation for the recent sell-off is worries about a possible trade war. A bullish market sentiment is shown by the Crypto Fear and Greed Index. The index reading at the time of writing was a robust 73, indicating market greed. Many holders made money because Bitcoin was only 3.9% below its peak. This explains why there was short-term sell pressure on July 4.
However, an instantaneous bearish market reversal is not always assured by an agreed signal. It’s important to note that on May 23, the Crypto Fear and Greed Index reached 78. The day Bitcoin hit $111.8K was the same day.
Bitcoin Holds, Altcoins Struggle: Is a Crypto Downturn Coming?
As of this writing, the index has notably stabilized at a comparable level. Some holders might have decided to profit from this, particularly given that Bitcoin is now trading within a specific range. As a result, altcoins have done worse than Bitcoin, which could indicate a market downturn. For altcoin investors, this is a warning to brace for more volatility, particularly if Bitcoin experiences additional losses in the days ahead.
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