“Bitcoin and most altcoins saw a pullback this week, with the crypto fear and greed index dropping into the ‘fear’ zone.”
Ethereum (ETH) fell by 3.7%, reaching a low of $2,100, which is more than 47% below its peak for the year. Meanwhile, Dogecoin (DOGE) dropped 1.6% to $0.2060, its lowest point since November 4. Ripple (XRP) saw a decrease of 2.19%, falling to $1.8010, marking a 47% decline from its year-to-date high.
“Other altcoins, such as Solana, Polkadot, and Chainlink, also faced double-digit losses on Monday. However, most of them managed to recover some ground, nearing their levels from the start of the week.
The total cryptocurrency market cap, as tracked by CoinMarketCap, initially dipped to $3 trillion on Monday but rebounded to $3.3 trillion by Friday.
The broader crypto market faced a downturn this week, driven by mounting concerns over a potential trade war between the U.S. and its major trading partners, including China, Mexico, and Canada. Former U.S. President Donald Trump announced a 25% tariff on imports from Mexico and Canada and a 10% tariff on Chinese goods.”
He later paused tariffs on Canadian and Mexican goods for 30 days, pending negotiations, while tariffs on Chinese imports remain unchanged. A prolonged trade war between these countries and European nations could fuel a risk-off sentiment, potentially putting pressure on riskier assets like cryptocurrencies.”
Bitcoin and altcoins saw a pullback as institutional demand remained subdued. Both spot Bitcoin and Ethereum experienced net outflows this week, while MicroStrategy paused its Bitcoin purchases after acquiring coins for twelve consecutive weeks, bringing its total holdings to 471,000 BTC.
Altcoins like Ethereum, DOGE, XRP, and SOL also dropped as investor sentiment soured. The fear and greed index, a closely watched gauge, fell to 35—its lowest level since October of last year. Historically, cryptocurrencies have tended to decline when fear dominates the market.”
These losses came as the altcoin season index continued to decline, while Bitcoin remained relatively steady. The index fell to 33, down from its year-to-date high of 47, suggesting stronger demand for Bitcoin compared to altcoins.
However, a potential bullish catalyst for altcoins may be the formation of a hammer candlestick pattern on the weekly chart. This pattern, which features a long lower shadow and a small body, is often seen as a bullish reversal signal.
On the other hand, Bitcoin has formed a bullish flag pattern on the weekly chart, which could signal a potential rebound in price.
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