U.S. stocks continued to fall on the first day of trading in June, and Bitcoin fell below the $30,000 mark

U.S. stock indexes fell slightly on the first trading day of June after a turbulent month. The S&P 500 fell 0.8%, and all three major U.S. stock indexes gave up early gains. The Dow Jones Industrial Average fell about 0.5%, while the tech-heavy Nasdaq Composite fell 0.7%. Bitpush terminal data showed that at the time of writing, the price of Bitcoin was about $29,774, falling below the $30,000 mark again, giving up the gains of the past few days.

Crypto analyst Michaël van de Poppe believes that $29,000 is now in focus. When the price of Bitcoin reached $31,150, he tweeted: "Quite simply, Bitcoin needs to hold here to test the $33,000 area. If not, a crash to the $29,000 range will soon follow."

Researcher Blake pointed to continued weakness in the stock market, which is highly correlated to Bitcoin, as a sign that people do not believe crypto assets have bottomed out.

The last time U.S. stocks faced a seven-week losing streak was more than a decade ago. The value of European equity issuance also hit its lowest level in 19 years after rising interest rates, inflation and macroeconomic uncertainty led investors to seek refuge in cash positions.

Some indicators suggest that stocks may have bottomed out last week, especially as stocks are 8.5% above their intraday low on May 20, but weak economic data is weighing on investor sentiment. This is driving risk aversion and negatively impacting the cryptocurrency market.

Bitcoin market sentiment remains in extreme fear zone

Data shows that extreme fear in the Bitcoin market has lasted for nearly a month, the longest stretch since April 2020.

The Crypto Fear and Greed Index continues to point to extreme fear this week, according to the latest weekly report from Arcane Research.

The Fear and Greed Index is an indicator that measures the overall market sentiment of Bitcoin and crypto investors. The indicator uses a numerical scale from 1 to 100 to represent this sentiment. All values ​​above "50" indicate greed in the market, while values ​​below this indicate fear among investors. Extreme values ​​above 75 and below 25 indicate emotions of "extreme fear" and "extreme greed" respectively.

Historically, Bitcoin price bottoms tend to form during periods of extreme fear. On the other hand, the cryptocurrency has observed tops during periods of extreme greed.

Some investors believe that because of this, it is best to buy during times of extreme fear, while extreme greed is suitable for selling.

Warren Buffett’s famous quote sums it up: “Be fearful when others are greedy, and be greedy when others are fearful.”

The chart shows that the Bitcoin Fear and Greed Index now has a value of 16, which indicates that the market is very fearful.

Long periods of sluggish sentiment are not uncommon in the cryptocurrency market, but in the past they have usually been followed by temporary spikes to improve sentiment.