Source: Cointelegraph Original: "{title}"
Bitcoin (BTC) has been in one of its least bullish phases since January 2023. According to Bitcoin's "Bull Market Score Index," investor sentiment shows the lowest reading in two years.
Bitcoin Bull Market Score Index. Source: CryptoQuant
CryptoQuant's "Cryptocurrency Weekly Report" briefing explains that a prolonged reading below 40 on the Bull Market Score Index increases the likelihood of a bear market. The Bull Market Score remained above 40 throughout 2024, only dropping below this threshold in February 2025, as shown in the chart above.
However, in the past 24 hours, Bitcoin's price has shown resilience compared to significant losses in the U.S. stock market. On Tuesday (April 3), Bitcoin closed with a green candle while the S&P 500 index fell by 4.5%, marking a historical first.
On Wednesday (April 4), the S&P 500 and Dow Jones indices continued to decline, dropping 3.87% and 3.44% respectively, while Bitcoin stabilized near the breakeven point.
CryptoQuant's data shows that Bitcoin's Value Days Destroyed (VDD) metric is currently around 0.72, indicating that Bitcoin's price is in a transitional phase. Such periods since 2023 have typically foreshadowed price consolidation or reaccumulation before a bullish breakout.
Bitcoin Value Days Destroyed. Source: CryptoQuant
The Bitcoin VDD metric tracks the movement of coins held for the long term and has signaled significant market trends since the end of 2024. The metric peaked at 2.27 on December 12, indicating aggressive profit-taking, a dynamic consistent with the peaks of 2021 and 2017. However, the VDD dropped to 0.65 in April, reflecting a cooling period where profit-taking has subsided.
This opens up possibilities for Bitcoin's "risk appetite" market. In financial terms, when investors accept higher-risk assets like cryptocurrencies, it is typically driven by optimism and mean reversion trends, referred to as a "risk appetite" scenario.
Amid ongoing market uncertainty triggered by the U.S.-led trade war, Bitcoin may unexpectedly benefit under these tense conditions.
Speaking about Bitcoin and the cryptocurrency market's potential as a hedge against traditional market volatility, crypto trader Jackis said:
"Reminder, this is not a decline driven by cryptocurrencies, but rather a decline driven by overall risk appetite, tariffs, and trade wars. As all of this unfolds, it seems that cryptocurrencies may have already experienced most of their downside and have recently absorbed all the sell-off."
Similarly, the Crypto Fear and Greed Index also registered in the "Fear" category on Wednesday (April 4), scoring 28. The index recorded an "Extreme Fear" score of 25 on Tuesday (April 3), indicating that the current price may present an attractive buying opportunity.
Crypto Fear and Greed Index. Source: alternative.me
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