A broad market recovery in crypto was led by Bitcoin, which went up to $43K on Tuesday. After halting its five-day slide ahead of Wednesday’s Consumer Price Index (CPI) release, the stock market in the US moved higher.
Data from Binance shows that the most valued crypto asset was trading at $42.7K on Wednesday morning, up 2% on the day.
Stocks and risky assets such as crypto assets seem to appreciate Powell’s comments about the United States remaining in a low-interest environment for some time.
Although on-chain indicators remain bullish and open interest is hopeful of an upside “short squeeze,” traders remain cautious despite the current push to $43K.
With the crypto price rebounding overnight, the Crypto Fear & Greed Index has maintained its position of “extreme fear” after plummeting to multi-month lows earlier this week.
Furthermore, some crypto pundits asserted that altcoins were likely to form bull traps by rising before resuming their own downward trend.
Additionally, many altcoins look as if they are about to bounce before a leg down
In many of the retesting areas, the rises have already bounced off after forming parabolic curves, but there are huge areas below where no supports have been placed.
Social trends from traders confirm the official bear market status of cryptocurrencies based on data from crypto intelligence platform Santiment.
As investors and traders capitulate in 2022, the bearish sentiment that prevailed in May 2021 continues.
“Traders seem to feel very strongly that crypto is in an official bear market based on social trend data. Bearish sentiment has not been this prevalent since mid-May, which is very promising news that weak hands are capitulating,” the blockchain analytic company added.