Bitcoin Reaches New All-Time Highs Before Retreating by 11%

It was a day of “oohs” and “ahhs” as Bitcoin finally succeeded in what it’d been threatening to do for months – set a new all-time high. After bursting through the $69K (nice AUD $106K) barrier, holders started to dream about all the Buggatis and tropical islands they could buy with their BTC bags. However, the celebrations were short-lived as investors began to take their profits, resulting in an 11% dip in just 24 hours. 

Related: ‘Larger Than Gold’: Galaxy’s Mike Novogratz Predicts Trillions Flowing Into Bitcoin

Fear and Greed Index Falls as Market Resets

The Fear and Greed index is often quite a reliable indicator for the crypto market. A key reason for this is that, unlike many other metrics, the F&GI incorporates social media tags into its algorithmic analysis. As the crypto world is often spurned by hype – which can typically be measured through social media activity – this makes the index a useful tool for applying a macro lens to the current market cycle. 

As the market has matured, the Fear and Greed Index has managed to spend longer durations in the “Extreme Greed” phase (90+), which generally indicates an impending correction. 

As BTC ticked over its USD pairing all-time high, so too did the F&G reading into “Extreme Greed”. Yet, just like the new ATH, this figure dissipated quickly as the metric dropped by 15 points in just a matter of hours. For now, Alternative.me’s Fear and Greed Index is reading 75 points, which suggests “Greed”. 

Although the sudden drop in Bitcoin’s price may seem like a poor outcome, many in the community who believed the markets were running too hot exhaled a sigh of relief. For one, the consolidation phase gives investors a chance to pick up BTC at a lower price than anticipated – with “BuyTheDip” hashtags at their highest point since the start of 2024. 

Related: Spot Bitcoin ETFs Hit Record $10bn in Daily Trading Volume

But after months of impressive gains, it shouldn’t be a surprise that the market has to cool off, even if just for a moment. As everyone gets a chance to catch their breath, the world can prepare for the upcoming BTC halving and the effect it will have on the market.