Fear and panic are gripping crypto markets as Bitcoin plunged under the US$39,000 mark this afternoon.

Bitcoin had recovered slightly to change hands at US$39,250 mark around 3.55pm AEST — still down 12.9 per cent from 24 hours ago.

About an hour earlier, it dropped to a four and a half month low of US$38,475, having pulled back nearly 40 per cent in the space of just over a month.

The crypto fear and greed index was a 23, indicating “extreme fear” – and that indicator was issued last night, before the worst of the selloff. Just a week ago it was a 68, pointing to greed.

 

Some 260,000 crypto derivatives traders had seen their positions liquidated in the past hour, to the tune of US$806 million, according to ByBt. (These traders were using leverage in the hopes of magnifying their gains, but instead lost the value of their entire trade — with some, depending on their settings, wiping out their entire account).

All but a handful top 100 cryptocurrencies were down from where they were 24 hours, led by Polygon (MATIC), which was trading at US$2.21, up 5.4 per cent.

The selloff meant that BTC was trading under its 200-day exponential moving average (EMA) on the daily charts of US$42,170 for the first time since September. If it did not bounce soon then a drop to US$36,000 or US$32,000 would be in play, technical analysts said.

Join our Cryptohead Facebook group to discuss all things cryptocurrency.

Read MoreBitcoinCryptocurrency

You might be interested in