As a seasoned crypto investor with battle-scarred fingers from navigating through countless market ups and downs, I find myself intrigued by the current state of Bitcoin’s Fear & Greed Index. With the index hovering around 70, it seems we’re teetering on the brink of ‘extreme greed.’ Yet, as someone who has witnessed the crypto market’s rollercoaster ride over the years, I must admit that I’m not entirely convinced by this wave of optimism just yet.
The data indicates that Bitcoin enthusiasm has been teetering on the brink of excessive optimism lately, but investors seem hesitant about fully jumping on the bandwagon.
Bitcoin Fear & Greed Index Is Currently Pointing At ‘Greed’
The “Fear & Greed Index” is a term coined by analysts at Alternative, serving as a gauge that reflects the overall emotion or sentiment of Bitcoin and broader cryptocurrency investors.
The index determines a numerical score ranging from 0 to 100 based on these factors: volatility, trading activity, public opinion via social media, market influence, and the popularity of related search queries on Google.
If the level of this metric surpasses 53, it indicates that investors generally exhibit a sense of greed. Conversely, values below 47 point towards a prevailing market fear. Values falling within the range between these two thresholds suggest a neutral or balanced sentiment among investors.
Now, here is what the Bitcoin Fear & Greed Index is like right now:
It’s clear from what you see that the current Fear & Greed Index reading is 70, indicating that traders overall are exhibiting a strong greedy sentiment. This trend isn’t something new; the market has actually been in this area of excessive greed for about a week now.
The below chart shows the trend in this indicator over the past year.
The graph indicates that the index dipped into an area of fear earlier this month, prompted by the downward trend in prices (bearish action). Yet, the sentiment among traders has noticeably improved due to the recent recovery rally.
Recently, the indicator has reached an unprecedented peak of 73, approaching a significant zone known as “extreme greed,” which appears when the value exceeds 75.
Historically, the market has tended to reach its peak when there’s excessive enthusiasm, as indicated by this region being frequently surpassed. Large amounts of hype, as we’ve seen before, are typically associated with market highs.
Additionally, there’s a corresponding area associated with intense fear, often referred to as ‘extreme fear’, which appears when readings fall between 25 and below. Historically, such profound levels of market despair have frequently preceded market bottoms for cryptocurrencies.
Over the past few days, the Bitcoin Fear & Greed Index appears to have plateaued slightly outside of the “extreme greed” zone, which could be due to a temporary halt in the ongoing bullish trend.
Although investors haven’t jumped aboard the hype bandwagon just yet, this could be a good indication for the success of the venture, since it seems that unchecked greed has not hindered its progress thus far.
BTC Price
Bitcoin has retraced back to $67,300 after having gone above $69,000 a couple of days ago.
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2024-10-23 19:11