Bitcoin prices have declined for four consecutive days as the crypto fear and greed index shifted back to the fear zone amid escalating geopolitical risks.

Bitcoin Price Analysis

Bitcoin’s price fell to $60,200, marking its lowest point since September 18, and an 8% drop from its highest level last week. This decline comes as investors adopt a risk-off sentiment due to rising geopolitical tensions following Israel’s pledge to retaliate for recent attacks.

Risk-averse behavior also affected other markets, with indices like the Dow Jones, S&P 500, and Nasdaq 100 continuing their sell-offs. Concurrently, bond yields increased, and the US dollar index rose to $101.50, its highest level since September 13.

Investor Activity and Whale Movements

Bitcoin’s retreat was also influenced by significant sales from major holders. One notable seller, Ceffu, withdrew 3,372 coins valued at $211.3 million. This entity has been offloading Bitcoin, Ethereum, Solana, and Avalanche, boasting assets worth over $2 billion.

After the $BTC price dropped, #Ceffu withdrew 3,372 $BTC ($211.33M) from #Binance in just 2 days!

Additionally, another investor sold 265 Bitcoins for $17.5 million last week, making a profit of $11.5 million after purchasing them for $6.2 million two years ago.

According to Santiment, the current reversal is partly due to heightened social media sentiment around Bitcoin. Historically, Bitcoin tends to dip when social media enthusiasm peaks.

Market Sentiment and Historical Trends

The crypto fear and greed index has dropped to the fear zone of 39, down from last week’s high of 60. Despite the current downturn, October is traditionally a strong month for Bitcoin, with average returns of 20.6%. November typically follows with average returns exceeding 46%.

Potential catalysts for a price increase include more Federal Reserve rate cuts and the conclusion of the American election period.

Technical Analysis

Technically, Bitcoin pulled back after hitting key resistance at $66,000, a significant price level connecting the highest swings since March. According to well-known trader Peter Brandt, a clear breakout will be confirmed if Bitcoin surpasses this resistance and rises above its all-time high.

The recent rally in Bitcoin did NOT disturb the 7-month sequence of lower highs and lower lows. Only a close above 71,000 confirmed by a new ATH will indicate that the trend from the Nov 2022 low remains in force.

On a positive note, Bitcoin has remained above the 50-day and 200-day moving averages and has formed an inverse head and shoulders pattern. This suggests a potential bounce-back in the coming days.

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