Bitcoin Fear & Greed Index Is Deep Inside Extreme Greed Territory Now
The “Fear & Greed Index” is an indicator created by that keeps track of the general sentiment present among the investors in the Bitcoin and wider cryptocurrency market right now.
The metric represents this average sentiment in the form of a score lying in the zero to hundred range. To calculate this score, the index takes into account the following five factors: volatility, trading volume, social media sentiment, market cap dominance, and Google Trends.The indicator appears to have a very high value at the moment | Source:As is visible above, the Bitcoin Fear & Greed Index’s current value is 90, which means that the investors are holding a strong sentiment of extreme greed. This latest value is quite the jump from the sentiment from yesterday, when the index was around 82.
The reason behind this sharp increase in the indicator is obviously because of the fact that the cryptocurrency’s price has been pushing towards a new all-time high during its latest rally.
The data for the metric over its entire history | Source:As displayed in the graph, the Bitcoin Fear & Greed Index has now surpassed the level that it assumed during the November 2021 price all-time high, as it stands at values just below those observed between late 2020 and early 2021.
Besides this period, there has only been one other instance in the history of the metric where it has achieved levels higher than now: the rally peak during mid-2019.
Historically, Bitcoin has tended to move against the expectations of the majority, and as this expectation has leaned more towards one side, the probability of such a contrary move taking place has only gone up. The top in the 2019 rally and November 2021 are just two such examples of this pattern in action. As such, it’s possible that the current extreme levels of the indicator mean that the price is at risk of forming a top right now. It should be noted, however, that a top doesn’t necessarily have to immediately follow, as during the first half 2021 bull run, the metric was able to maintain at even higher levels for a while, without the rally being compromised.BTC Price
Bitcoin was on the brink of setting a new all-time high just earlier, but its price has since cooled off towards the $66,700 level.Looks like the price of the coin has been marching up during the past couple of days | Source: