The sudden crash of () on Jan 10 saw the price trade below $40,000 for the first time in 110 days and this was a wake-up call for leveraged traders. $1.9 billion worth of long (buy) futures contracts were liquidated that week, sending trader morale plummeting.
The “crypto Fear & Greed” index, which ranges from 0 for “extreme fear” to 100 for “greed”, reached 10 on January 10, the lowest level since the crash of March 2020. The indicator measures the Trader sentiment using historical volatility, market momentum, volume, Bitcoin dominance and social media.
As usual, the panic turned into a buying opportunity as the total cryptocurrency market capitalization surged 13.5%, going from a low of $1.85 trillion to $2.1 trillion in less than three days.
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