Crypto Market Bounces Amid Extreme Fear

• Crypto rebounds slightly after recent losses
• Traders still gripped by extreme fear
• Fed rate cut expectations influence market sentiment

After enduring several sharp down days, the crypto market is finally showing a modest bounce. Bitcoin (BTC) has risen by 0.8% to $86,999, while Ethereum (ETH) has inched up 0.6% to $2,842. These gains, though small, come as a relief to traders battered by recent volatility.

The overall market capitalization has recovered slightly, now standing at $3.14 trillion. However, $209 million in liquidations over the past day show that the pain isn’t over yet. Despite today’s uptick, fear continues to dominate trader sentiment.

Extreme Fear Persists Despite Fed Cut Optimism

One of the key drivers of today’s rebound appears to be the growing likelihood of a Federal Reserve rate cut in December. Lower interest rates are typically favorable for risk assets like crypto. However, the market is still deeply in the grip of fear.

The Fear & Greed Index (FGI) currently sits at 19 — well into the “Extreme Fear” zone. This suggests that while prices have bounced, confidence has not yet returned. Traders remain cautious, wary of further downside.

RSI Indicates Oversold Conditions

From a technical perspective, the recent rally is being attributed to oversold conditions. The Relative Strength Index (RSI), a popular momentum indicator, suggested the market was due for at least a short-term rebound.

Still, analysts warn that this may just be a temporary relief bounce rather than the start of a larger bullish trend. Many investors are choosing to sit on the sidelines until there is more clarity on macroeconomic policy and broader market direction.

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• Crypto Market Bounces Amid Extreme Fear