The Crypto Fear & Greed Index, developed by Alternative, has jumped by 11 points. This downturn is a clear indication of the change in market sentiment from ‘Neutral’ to ‘Greed’. The index acts as an indicator of investor sentiments within the crypto market. Specifically, it jumped up to 64, a sign of extreme bullishness and extreme buying pressure among investors. This underlying change in behavior reflects the rising expectation of sustained price increases in the immediate future.
The Crypto Fear & Greed Index is a tool used to measure the current sentiment in the cryptocurrency market by examining six different factors. These are volatility, market momentum/volume, social media sentiment, Bitcoin dominance, survey data, and Google Trends. Currently, survey data is paused.
The index’s advance into the ‘Greed’ zone shows that there has been an extreme spike on the buying side of the equation. This pressure can create a feedback loop that tends to push prices even higher as investors start more readily buying the cryptocurrency, expecting to profit long-term.
The Crypto Fear & Greed Index works by monitoring six indicators, such as market volatility and social media sentiment. Through evaluating these indicators, the index is able to present a holistic look at the emotional climate in the cryptocurrency market. At a score of 64, this is a clear sign that the overall market is in an optimistic cycle.
The Crypto Fear & Greed Index is currently reflecting extreme greed. This kind of optimism usually spurs on a lot more speculative bullishness across the crypto markets. Investors would do well to keep their radar tuned to the dangers of rampant greed, which has often marked the beginnings of a market correction.
