Machine Learning Algorithm Predicts Ethereum Price Crash To $1,500 After 4 Red Month Closes

The Ethereum price could face another significant crash, as the machine learning algorithm, CoinCodex, predicts a sharp decline toward $1,500. After enduring four consecutive months of sideways trading and bearish closes, technical indicators and sentiment data are flashing warning signs of an impending correction in the coming weeks.   Ethereum Price Crash To $1,526 Incoming According to CoinCodex’s latest Ethereum price prediction, ETH is expected to decline by 16.47% over the coming weeks, potentially reaching $1,526.06 by June 2, 2025. This bearish projection comes amidst a turbulent market cycle in which investor sentiment and confidence have wavered due to rising macroeconomic pressures and unexpected declines in Bitcoin.  Related Reading: Ethereum Price Reaches Last H1 Support, Next Major Resistance Comes Into View Notably, Ethereums technical outlook continues to deteriorate as it just wrapped up its fourth consecutive monthly red candle. Cryptoranks data shows that Ethereum experienced a dip of 1.27% in January, followed by sharper losses of 32.2% in February and 18.4% in March. The downtrend continued into April, with the cryptocurrency closing the month in red with another 1.58% decline.  Despite brief intra-month rallies that saw its value rise sharply, Ethereum has consistently failed to sustain gains, closing each month with rising selling pressure and leading the wider market drawdown. CoinCodexs data further paints a grim picture, highlighting that the top altcoin has recorded 16 green days out of the last 30, signaling unstable market strength. Its price volatility, measured at 6.43%, also reflects a choppy market that lacks clear bullish conviction.  Moving forward, CoinCodex not only predicts that Ethereum could break down to $1,526 but also expects a steeper price crash to $1,447.96 by August 1, 2025. This would represent a decline of approximately 20.75% from current market prices. The machine learning algorithm has declared that broader market sentiment for ETH is currently bearish, implying that traders and investors still anticipate further corrections and limited upward momentum in the near term. Overall, this indicates a cautious outlook for Ethereums price prospects. CoinCodex Says Now Is A Bad Time To Buy ETH Given its bearish forecast for the Ethereum price, CoinCodex suggests that now may not be the best time to buy Ethereum. Interestingly, while investor sentiment remains cautious, the Fear and Greed index is at 65, reflecting a state of Greed and suggesting that market optimism may be outpacing the underlying bearish fundamentals.  Related Reading: Ethereum By End Of 2025: Why A Surge Over $4,000 Is Imminent Building on this, crypto whales are still buying ETH in droves, capitalizing on low prices despite the possibility of a continued downtrend. Recent reports reveal that a single whale purchased 30,000 ETH tokens worth approximately $54 million. With price momentum fading and macro uncertainty still high, ETH bulls may need to wait for market stabilization and clearer reversal signals before re-entering the market. According to CoinMarketCap’s data, the Ethereum price is currently trading at $1,827, marking a yearly decline of over 38%. Featured image from Unsplash, chart from Tradingview.com

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Bitcoin Market May Cool Off In 4 To 6 Weeks But Heres What Needs To Happen

Over the years, investor sentiment has been one reliable way to analyze the Bitcoin and cryptocurrency market. Based on recent on-chain data, an analyst has pointed out how the changing investor sentiment could affect the worlds largest cryptocurrency over the next few weeks. Can BTC Price Charge To New All-Time High? In a recent post on X, crypto analyst Axel Adler Jr explained how the Bitcoin market dynamics could significantly shift in the coming weeks. This projection is based on recent changes in the Bitcoin Fear and Greed Index. Related Reading: Ethereum Price Nears Major Resistance At $2,200, Why A 13% Crash Could Follow The Bitcoin Fear and Greed Index refers to a metric that aggregates the average sentiment of investors in the BTC market. The indicator is divided into five zones, including extreme fear, fear, neutral, greed, and extreme greed. Extreme fear signals that traders and investors are moving with high caution, while extreme greed suggests an overheating market condition with traders flooding in with new positions. Historically, periods of extreme fear have been correlated with market bottoms while price corrections usually occur during extreme greed. According to Adler Jr., the 90-day simple moving average (SMA) of the Bitcoin Fear and Greed Index has fallen by approximately 22 percentage points over the past two months. This decline has seen the BTC metric shift from extreme greed to a more moderate level of greed. Going further, the on-chain analyst mentioned that if the Bitcoin Fear and Greed Index drops by another 10 to 15 points in the near future, the market may experience a cooling-off period where participants could have become accustomed to negative factors and emotional price movements may even subside. Adler Jr added in his post: At the current pace, it may take approximately 4 to 6 weeks for the index to drop by an additional 1015 points. The analyst also highlighted that the 30-day (monthly) moving average appears to be reaching a local bottom, one seen at the end of the Bitcoin price correction to $54,000. The last time the Fear and Greed Index monthly SMA reached this level, the premier cryptocurrency climbed to a new all-time high price. If this historical pattern holds, investors could see the BTC price break out of its consolidation range. Bitcoin Price At A Glance As of this writing, the price of BTC is just beneath the $84,000 level, reflecting a 0.5% decline in the past 24 hours.  Related Reading: XRP Price To $27: Why Current Boredom Phase Could Trigger Epic Rally Featured image from iStock, chart from TradingView

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Solana Price Crash To $90? Why A 26% Decline Could Rock This Crypto

The Solana price is seemingly on the verge of another major crash, as an analyst forecasts a correction to $90. Given the cryptocurrencys recent slow momentum due to the ongoing market letdown, an additional 26% decline to new lows could significantly impact the future outlook of Solana. Analyst Forecast Massive SOL Price Crash CoinMarketCaps data shows that the Solana price has given up most of its yearly gains following its massive 50% price crash earlier last month. Despite this bearish performance, TradingView crypto analyst MadWhale highlights that the pain isnt over yet, projecting an even deeper price decline for the popular altcoin.  Related Reading: Solana Price On The Verge Of 2022-Like Crash To Send It Back To $22? The analyst believes that a 26% drop to $90 may be on the horizon if Solana fails to find proper support. Sharing a detailed price that supports his bearish prediction, MadWhale suggested that the Solana price is currently in a Descending Channel, indicating a sustained downtrend.  The chart shows that the altcoins price movement is making lower highs and lower lows, confirming its already bearish structure. Moreover, Solana is presently struggling to break above the key resistance area indicated by a straight red line above the $130 threshold.  The curved red arrow in the chart highlights the trajectory to which Solana is expected to move if it fails to surpass resistance levels. The $90 level is also marked as the main monthly support for the altcoin, where a potential bounce back or accumulation is set to arise. If Solana can retest this support level, MadWhale believes it could recover enough to sustain a lengthy upward trend.  While Solanas overall price position and market trend are in the red, the TradingView analyst acknowledges that temporary bullish movements could happen. However, these minor fluctuations would be short-lived, as they are part of the broader downtrend.  Notably, MadWhale has marked the $100 mark as a psychological resistance level for the Solana price, where a decline toward this threshold could influence its market sentiment.  Solana Market Sentiment Switches To Fear Solanas market sentiment recently hit 1-year lows, but on-chain data shows an even more volatile trend. The altcoins Fear and Greed index at 34 indicates that it may be approaching extreme fear zones. This suggests a potential period of panic-driven sell-offs by investors.  Related Reading: Solana Forms Ascending Triangle For Possible Breakout, Analyst Sets $565 Target CoinCodexs data also highlights that Solana’s overall market trend is significantly bearish. Over the last 30 days, Solana has recorded more red days than green, signaling a prolonged downtrend. As a result of its bearish price action, CoinCodex indicates that now may be a bad time to buy the altcoin.  Commenting on Solanas current market sentiment, crypto analyst Market Prophit notes that the crowd remains bearish on the cryptocurrency. However, smart money stays bullish, fueling hopes of a possible price reversal in the altcoin. Featured image from Adobe Stock, chart from Tradingview.com

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Crypto Fear and Greed Index at Highest Level Since Bitcoin Hit $69,000

Crypto investors turn greedy as bitcoin (BTC) tops $28,000.

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Bitcoin Trader Sentiment Returns To Greed As BTC Jumps Past $25,000

Data shows the Bitcoin market sentiment has turned to greed again as the cryptocurrency price has sharply risen above the $25,000 level. Bitcoin Fear And Greed Index Is Pointing At Greed Once Again The “fear and greed index” is an indicator created by Alternative that tells us about the general sentiment among traders in the [...]

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Bitcoin’s Fear and Greed Index Flashes ‘Greed’ for the First Time in 10 Months

Bitcoin's Fear and Greed Index suggests that crypto traders are becoming more bullish on the largest cryptocurrency.

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Bitcoin Investors Turn Greedy For First Time Since March 2022

Data shows investors in the Bitcoin market have turned greedy for the first time since March 2022, after what was the longest stretch of fear ever. Bitcoin Fear And Greed Index Now Points At “Greed” The “fear and greed index” is an indicator that tells us about the general sentiment among investors in the Bitcoin (as well as the wider crypto) market. To represent this sentiment, the metric uses a numeric scale that runs from 0-100. All values below 50 imply a fearful market, while those above this threshold suggest greedy holders. Although this cutoff point might look clean in theory, in practice, the region between values of 46 and 54 is generally considered to belong to a “neutral” sentiment. Real breakouts towards fear or greed only take place when the metric crosses below or above this transition region. There are also two other “special” sentiments: extreme greed and extreme fear. The former occurs above values of 75, while the latter happens under values of 25. The significance of these extreme sentiments is that tops and bottoms have historically tended to form when the investors have held these mentalities. Because of this, some traders believe extreme fear periods provide ideal buying opportunities (as bottoms have taken place here), while times with extreme greed could be the best selling windows (since tops occur here). Related Reading: CryptoQuant’s Bitcoin PnL Index Forms Bullish Crossover A trading strategy called “contrarian investing” is based on a similar idea. As Warren Buffet said in his famous quote, “be fearful when others are greedy, and greedy when others are fearful.” Now, here is how the current sentiment among Bitcoin (and wider crypto) investors looks like: A greedy cryptocurrency sector | Source: Alternative As can be seen above, the Bitcoin fear and greed index has a value of 55 right now, suggesting that the market has now properly entered into the greed zone. Before this break into the region, the sector had been in the fear region nonstop since March 2022, around ten months ago. Related Reading: Litecoin Whale Transactions Set New 2023 High, Bullish Signal? The below chart shows how the metric’s value has changed during the past year. Looks like the metric has observed some growth in recent days | Source: Alternative From the graph, it’s visible that the indicator had spent almost the entire past year not just in the fear zone, but actually all the way down in the extreme fear region. There was only one proper spike into greed during this period, and that was the aforementioned March 2022 instance. This previous surge had only lasted for a single day before the market became fearful again. These continuous streaks of fear and extreme fear during the past year were both the longest runs in the history of the indicator. Greed finally returning to the Bitcoin market after all this while could mean that investors are ready to embrace some bullish action once again, which could be a positive sign for the current rally. BTC Price At the time of writing, Bitcoin is trading around $22,900, up 9% in the last week. The value of the asset seems to have been consolidating in recent days | Source: BTCUSD on TradingView Featured image from André François McKenzie on Unsplash.com, charts from TradingView.com, Alternative.me

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Bitcoin price surge: Breakthrough or bull trap? Pundits weigh in

Bitcoin nearly broke its record for the longest streak of daily green price candles this month, but many believe its recent surge could be short-lived.

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2022: The Year Of Crypto Market Fear

Data shows 2022 has been the year of fear in the crypto market as investors have continued to display poor sentiment for around eleven months now. Crypto Fear And Greed Index Currently Sits In “Extreme Fear” Territory As per the latest weekly report from Arcane Research, the cryptocurrency market could soon complete one full year of fearful sentiment. The relevant indicator here is the “fear and greed index,” which tells us about the general sentiment among investors in the crypto market. The metric uses a numeric scale that runs from zero to hundred for representing this sentiment. All values greater than fifty imply a greedy mood, while those below the threshold suggest a fearful air. Outside of these two sentiments, there also exist two subset sentiments, the “extreme fear” and the “extreme greed.” These occur at values towards the ends of the range. That is, those above 75 for the former, and those below 25 for the latter. Related Reading: How Bitcoin On-Chain Signals Present A Solid Case For A Market Bottom Now, here is a chart that shows the trend in the crypto fear and greed index over the past year: The value of the metric seems to have been moving sideways during recent weeks | Source: Arcane Research's The Weekly Update - Week 41, 2022 As you can see in the above graph, the current long spell of fear first started way back in mid-Nov of last year as the bull run died down. Since then, outside of only a few spikes to greed, the crypto fear and greed index has stayed below a value of fifty. Related Reading: SEC Rejects Another Bitcoin ETF, Exasperated Investors May Turn To Uniglo For Long-Term Crypto Gains During this period, the metric has actually spent a large amount of time in the extreme fear territory, meaning investors have had a deep bottom mentality in 2022. The latest value of the indicator has been 22, meaning that investors are extremely fearful at the moment. This isn’t much different from the last week, which observed a value of 24. The below meter displays where the current market stands compared to last week and last month. The fear and greed index points at extreme fear right now | Source: Arcane Research's The Weekly Update - Week 41, 2022 BTC Price At the time of writing, Bitcoin’s price floats around $19.2k, up 1% in the last seven days. Over the past month, the crypto has lost 1% in value. Below is a chart that shows the trend in the price of the coin during the last five days. Looks like the value of the crypto has continued to be stuck in a range over the last few days | Source: BTCUSD on TradingView Featured image from Hans-Jurgen Mager on Unsplash.com, charts from TradingView.com, Arcane Research

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Crypto Market Stays In Deep Fear As Bitcoin Continues To Struggle

Data shows the crypto market has been deep into fear recently as the price of Bitcoin has struggled, but sentiment is still not inside extreme fear. Crypto Fear And Greed Index Shows Investors Are Fearful Right Now According to the latest weekly report from Arcane Research, the crypto market sentiment has remained stable in deep fear territory during the past week. The “fear and greed index” is an indicator that tells us about the general sentiment among investors in the crypto market. The metric uses a numeric scale that moves from zero to hundred for representing this sentiment. All values on the upper side of 50 indicate a greedy market, while those below the mark imply investors are fearful. Related Reading: Bitcoin aSOPR Rebounds From “1” As Weakness Remains In Market Values of the indicator towards the end of the range signify sentiments of “extreme greed” (more than 75) and “extreme fear” (less than 25). Now, here is a chart that shows the trend in the crypto fear and greed index over the past year: The value of the metric seems to have come down in recent days | Source: Arcane Research's The Weekly Update - Week 34, 2022 As you can see in the above graph, the crypto fear and greed index had been climbing up for a few weeks and almost entered into the greed territory as prices of coins like Bitcoin rallied up. However, with the end of the rally, the market sentiment immediately plummeted back down into the depths of fear, showing the investor mentality was quite weak to begin with. Related Reading: Miners To Experience An All-Time High Bitcoin Mining Difficulty, What’s Next? The current value of the indicator is just 27, which is only two points away from the extreme fear territory. This is a slight decline over the last seven days as the metric had a value of 28 then. Looks like the value of the indicator was 42 last month | Source: Arcane Research's The Weekly Update - Week 34, 2022 Nonetheless, the report points out that at the same low $20k levels of the Bitcoin price as now, the market sentiment was much worse back in June as it was firmly inside extreme fear. This implies that investors are now more comfortable at these price levels than compared to a couple of months back. BTC Price At the time of writing, Bitcoin’s price floats around $20.3k, down 5% in the last week. Over the past month, the crypto has lost 14% in value. The below chart shows the trend in the price of the coin over the last five days. The value of the crypto has been mostly moving sideways during the past few days | Source: BTCUSD on TradingView Featured image from Peio Bty on Unsplash.com, charts from TradingView.com, Arcane Research

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Two Months Of Extreme Fear Leaves Crypto In Panic, Bitcoin At $20K

Data shows the crypto market has been observing extreme fear for two months now, leaving investors in panic as Bitcoin has crashed to $20k. Crypto Fear And Greed Index Is Still Pointing To “Extreme Fear” As per the latest weekly report from Arcane Research, the cryptocurrency market has now been facing extreme fear for two months now, the longest streak in history. The “fear and greed index” is an indicator that measures the general sentiment among investors in the crypto market. The metric uses a numeric scale that runs from zero to hundred for representing this sentiment. All values greater than fifty imply that investors are greedy at the moment, while those below the threshold signify a fearful market. Edge values of above 75 and below 25 mean holder sentiments of “extreme greed” and “extreme fear,” respectively. Now, here is a chart that shows the trend in the crypto fear and greed index over the past year: Looks like the value of the indicator has been very low recently | Source: Arcane Research's The Weekly Update - Week 24, 2022 As you can see in the above graph, the crypto fear and greed index has a value of 9 right now, suggesting that the market is extremely fearful. Such low sentiment values have now persisted for two months now, making this the longest extreme fear run the market has ever seen. Related Reading | Crypto Market Crashes Further: Bitcoin (BTC) and Ethereum (ETH) Value Slumps These indicator values have stayed while the entire crypto sector has gone through a crash and a large part of the investors have gone into the red. Historically, streaks with extreme fear have been when coins like Bitcoin have tended to form bottoms (and similarly, tops have occurred during extreme greed). Because of this, some analysts believe an extremely fearful market can provide fresh buying opportunities for cryptos. Related Reading | Bitcoin “Diamond Hands” Start To Break As 1yr+ Supply Ramps Up Selling The trading technique that follows this idea is called “contrarian investing.” This famous quote from Warren Buffet encapsulates the philosophy: “be fearful when others are greedy, and greedy when others are fearful.” If the historical trend is anything to go by, the current long run of extreme fear may be when Bitcoin and other coins observe bottoms. And if so, now may be when a contrarian investor will believe to be an ideal buying point. Bitcoin Price At the time of writing, BTC’s price floats around $20.4k, down 1% in the last seven days. Over the past month, the crypto has lost 30% in value. The below chart shows the trend in the price of the coin over the last five days. The value of Bitcoin seems to have dropped down over the past day | Source: BTCUSD on TradingView Featured image from Thought Catalog on Unsplash.com, charts from TradingView.com, Arcane Research

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Bitcoin 50% Down From Its All-Time High

The value of Bitcoin dropped to the lowest level in past ten months.

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Bitcoin whales jumping ship as exchange inflows reach 3-month high

The Bitcoin market appears to be retracing the gains it has made since January as whales may be exiting and selling on centralized exchanges according to Glassnode.

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The Fear Around $41,000 Bitcoin Is A Sign Of Success

$41,000 bitcoin has been so normalized that people don't believe that it is "this low."

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Bitcoin Fear And Greed Index Has Dipped To Lows Not Seen Since July

Following the Bitcoin crash to $42k, the fear and greed index has declined to extreme fear values not seen since July of last year. Bitcoin Fear And Greed Index Points At “Extreme Fear” As pointed out by an analyst in a CryptoQuant post, the BTC fear and greed index has dropped to very low values. The “fear and greed index” is a crypto indicator that measures the general sentiment among investors in the market. The index uses numbers to represent the sentiment on a numeric scale that goes from zero to hundred. Values of the indicator above fifty mean that the current holder sentiment is that of greed. And values below 50 imply that the market is fearful at the moment. Index values below 25 and those above 75 fall into the “extreme” category, signifying extreme fear and extreme greed, respectively. The indicator usually remains in the greed zone during bull runs. Extreme greed values have historically signaled that a correction in the price of Bitcoin may be near, and a top could form. On the other hand, values of fear may be there during bearish trends, and extreme fear might imply that a bottom could soon form. Related Reading | Bitcoin Whales Contribute 90% Of Money Inflow of Exchanges, How Can We Follow and Make Profits? Now, here is a chart that shows the trend in the Bitcoin fear and greed index over the past year: The crypto fear and greed index seems to have sunk to extreme fear values | Source: CryptoQuant As you can see in the above graph, the indicator has now dipped to a value of 15. This is the lowest the metric has gone since July of the previous year. Related Reading | Start Of Bear Period? Current Bitcoin Trend Looks Similar To June Incidentally, the day in July when such low values occurred was also around when the Bitcoin price bottomed out. However, the quant in the post notes that this doesn’t necessarily mean that the current price has hit a bottom as well. Following the May crash, the months of May and June also observed similar extreme fear sentiments multiple times. So, it’s rather possible that the current low values of the indicator may persist for a while, just like back then, before the price finds its way back up. BTC Price At the time of writing, Bitcoin’s price floats around $42.4k, down 12% in the last seven days. Over the past month, the crypto has lost 16% in value. The below chart shows the trend in the price of BTC over the last five days. After the crash down to $42k a few days back, BTC's price further plunged down to $41k yesterday | Source: BTCUSD on TradingView Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com

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Crypto Markets are in “Extreme Fear”- Should You Buy Now?

The Crypto Fear and Greed Index (FGI) is a daily snapshot of the general market sentiment within the crypto space based on different weighted factors that include: volatility, market volume, social media, dominance, and trends.

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Crypto Market Bloodbath Creates Largest Stretch Of Fear Since April Peak

As the downtrend in the crypto market continues, so does extreme fear. What’s inspiring the sell-off? Is it Omicron? Or is it Evergrande? Is it a conspiracy? Or is it the holidays? All those questions and more have had the Fear and Greed Index pointing left for a month straight. What does this mean? Where do we go from here? That’s what we’re here to explore.  Related Reading | Blood In The Streets: Crypto Market Becomes Fearful As Bitcoin Dives But first, let’s talk about the Fear and Greed Index. One of the many Bitcoin indicators, it measures the market’s general sentiment at the moment. Zero is extreme Fear. A hundred is extreme Greed. And the indicator oscillates between those two at any given time. It’s been said that the crypto market is very emotional. The Fear and Greed Index is there to keep investors from making irrational decisions based on sentiment alone.  Fear And Greed Index shows Extreme Fear | Source: Arcane Research’s The Weekly Update What’s The Fear And Greed Index Saying Now? According to Arcane Research’s The Weekly Update, fear has settled in: “The Fear and Greed Index has now signaled “Fear” or “Extreme Fear” for almost one month straight. The last time we saw such a prolonged fearful market sentiment was at the beginning of the summer when the market sentiment was fearful for more than two months straight. With the sustained consolidation of bitcoin, the late autumn euphoria has dampened, and the overall sentiment seems very negative at the moment.” The report also says that, “during steady sell-offs, bitcoin tends to outperform the overall crypto market.” And this time was no exception, BTC “outperformed all indexes so far in December, seeing a negative return of -18% after a relatively flat second week of trading this month.” On the other hand, “the Small Cap index has seen a loss of nearly a third of its value in December.“ What does this mean in general? “The bitcoin dominance has risen by 1.13% in the last week. This is the third time we’re seeing bitcoin dominance bottom at 40% in 2021. The last two times were May 19th and Sep 13th. It seems that the 40% threshold is a difficult area for alts to sustain” BTC price chart for 12/15/2021 on Eightcap | Source: BTC/USD on TradingView.com What Can We Expect In The Future? To get our dose of technical and on-chain analysis, let’s give the mic to this month’s Fear & Greed Newsletter: “A major factor here is the cycle support band. We cannot ignore the fact that Bitcoin had just closed 2 consecutive weeks below the market support band. Historically, this meant that we’d see a longer consolidation phase before we could have a true reversal in the trend. The takeaway here is this, as long as Bitcoin closes the week below the cycle support band, we shouldn’t expect any major breakout in price to take place.” Every dog has its day, though. A week ago, analyzing a very similar market sentiment, NewsBTC informed you: “A “Fear and Greed” Index on Extreme Fear levels, according to certain analysts, has historically preceded crypto market local bottoms. However, a run into new highs could see an obstacle as the macro-economic outlook turn complex.” Related Reading | Bitcoin Price Bloodbath: Is El Salvador A “Sell The News” Event? It’s also important to remember that only two months ago, we were in a similar situation and the sentiment did a complete 180 in a matter of weeks.  “The indicator dipped all the way down to extreme fear on 30th September, but in under two weeks the sentiment has already rebounded back to extreme greed. The report notes that this shows how fast the sentiment can change among the crypto market.” With that being said, and a disclaimer that this isn’t financial advice, in a situation like this there’s only one thing we could say… hodl the line!  Featured Image: PublicDomainPictures on Pixabay| Charts by TradingView

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Retail Investors “Extremely Fearful,” But History Tells Us It Might Be A Good Time To Buy

If you are a Bitcoin holder and feeling a bit uneasy about the current market conditions, you are certainly not alone.  Yesterday, the Crypto Fear and Greed Index (CFGI) hit a 21 out of 100, corresponding to “extreme fear.”  However, after looking at two years worth of data, this amount of fear in the market […]

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Crypto “Fear and Greed” Index

There are three primary drivers behind any type of market where trading occurs.

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Crypto Market Sees Record Flash Crashes, Whats Going On?

The crypto market has experienced an unprecedented surge in volatility, with established coins like Bitcoin and Ethereum facing extreme price swings. Since January, the frequency of flash crashes has risen sharply, erasing billions from the market. A crypto analyst has suggested that these flash crashes have been driven by several factors, providing a detailed insight into whats really going on in the market.  Why Flash Crashes Are Occurring In The Crypto Market A crypto analyst known as The Kobeissi Letter has shed light on the recent market crash and why top coins are falling drastically. The analyst revealed that the increasing number of flash crashes has resulted in over $300 billion being removed from the market in just 24 hours.  Related Reading: Crypto Liquidations Cross $2.22 Billion, Heres How Much Dogecoin Traders Lost He disclosed that on the previous day, the market began selling off, with Bitcoin dropping below the $95,000 mark. Between 1:45 AM ET and 2:15 AM ET, the cryptocurrency had one of the most shocking crashes, falling by $5,000 in mere minutes.  Ethereum, the second largest cryptocurrency after Bitcoin, had it even worse. The altcoin experienced massive liquidations that contributed to a 37% price crash on February 2, fueled by trade war headlines.  The Kobeissi Letter has revealed that the key factor behind these dramatic flash crashes is the growing divide between institutional and retail investors. Wall Street Hedge funds have increased their short positions on Ethereum by 500% since November 2024, marking a historic level of institutional bearishness toward Ethereum. Short positioning in Ethereum has also increased by over 40% in just one week. Moreover, Ethereums price is down by approximately 40% since December 2024, while Bitcoin has fallen by 15%.  On the other hand, institutions have continued to accumulate Bitcoin, while retail investors have poured capital into smaller altcoins like Solana, creating extreme volatility in these assets. This polarization, as the analyst calls it, has led to the formation of air pockets in liquidity. As a result, when a sell-off starts, it triggers cascading liquidations, amplifying market instability and price crashes.  The analyst has also pinpointed that this polarization phenomenon works in the opposite direction, as the market can experience rapid recovery, leading to billions added to its market cap within hours.  Shifts In Sentiment And Political Influence Contribute To Market Crash The Kobeissi Letter revealed that the Fear and Greed Index has fallen from a bullish stance just weeks ago to 29% extreme Fear, underscoring the speed at which the markets sentiment is changing to the negative. The analyst suggests that the extreme positioning in the crypto market is leading to these increasing flash crashes, making crypto significantly unpredictable.  Related Reading: Crypto Fear And Greed Index Barrels Toward Extreme Greed Again As Bitcoin Price Clears $101,000, Is This Good News? Adding to the turbulence, the analyst revealed that political and corporate influences have been dictating the crypto market. He underscored that Eric Trump had publicly supported buying Bitcoin and Ethereum during dips, aligning with events like Ethereums February 3 recovery and Bitcoins rebound on February 25.  While the market experiences flash crashes and instability, MicroStrategy continues to accumulate Bitcoin. The analyst revealed that the company had also contributed to the polarization of Bitcoin due to its unending accumulation trend. While the company buys more Bitcoin, MSTR stocks continue to fall, marking a 45% decline from their high on November 20. Featured image from Unsplash, chart from Tradingview.com

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