Market sentiment in the cryptocurrency sector deteriorated sharply on Tuesday after Bitcoin briefly dipped below $106,000 for the first time in more than three weeks. The Crypto Fear & Greed Index fell by half from the previous day to a score of 21 out of 100, reflecting “Extreme Fear” across the market.

Bitcoin dropped to a 24-hour low of $105,540 on Monday after reaching an intraday high of more than $109,000. It later rebounded slightly, trading above $106,500 at press time, according to CoinGecko.

The index’s latest reading marks its weakest point in nearly seven months, last reaching a score of 18 on April 9 when both crypto and stock markets fell in response to U.S. President Donald Trump’s global tariff measures.

Bitcoin’s decline rekindles “Extreme Fear”

The index previously entered the “Extreme Fear” range on Oct. 22, when Bitcoin slid from above $110,000 to below $108,000. Since then, it has fluctuated between “Extreme Fear” and “Neutral” following the sharp correction from Oct. 9–10, when Bitcoin dropped from its Oct. 6 peak of over $126,000.

Before that downturn, the index had reached a high of 74 on Oct. 5, signaling “Greed,” as market optimism peaked.

Institutional pullback and policy concerns

Analysts attribute Bitcoin’s latest decline to weakening institutional demand, slowing blockchain activity, and growing caution surrounding the Federal Reserve’s monetary policy stance. While the Fed implemented its second interest rate cut of the year on Wednesday, its signal that no further cuts may come in 2025 dampened investor sentiment and weighed on crypto prices.

Recent data also showed net outflows of nearly $800 million from Bitcoin-linked exchange-traded funds, marking the first time in seven months that institutional buying fell below the level of newly mined supply.

Despite current market unease, many crypto traders remain hopeful for a so-called “Moonvember.” Historically, Bitcoin has gained an average of over 42% during November, making it its strongest performing month of the year.

Sources:

https://cointelegraph.com/news/crypto-sentiment-nosedives-extreme-fear-bitcoin-drops-under-106k

https://alternative.me/crypto/fear-and-greed-index/

https://www.coingecko.com/en/coins/bitcoin