Bitcoin Fear And Greed Index Has Dipped To Lows Not Seen Since July
07 Janvier 2022 - 8:00PM
NEWSBTC
Following the Bitcoin crash to $42k, the fear and greed index has
declined to extreme fear values not seen since July of last year.
Bitcoin Fear And Greed Index Points At “Extreme Fear” As pointed
out by an analyst in a CryptoQuant post, the BTC fear and greed
index has dropped to very low values. The “fear and greed index” is
a crypto indicator that measures the general sentiment among
investors in the market. The index uses numbers to represent the
sentiment on a numeric scale that goes from zero to hundred. Values
of the indicator above fifty mean that the current holder sentiment
is that of greed. And values below 50 imply that the market is
fearful at the moment. Index values below 25 and those above 75
fall into the “extreme” category, signifying extreme fear and
extreme greed, respectively. The indicator usually remains in the
greed zone during bull runs. Extreme greed values have historically
signaled that a correction in the price of Bitcoin may be near, and
a top could form. On the other hand, values of fear may be there
during bearish trends, and extreme fear might imply that a bottom
could soon form. Related Reading | Bitcoin Whales Contribute
90% Of Money Inflow of Exchanges, How Can We Follow and Make
Profits? Now, here is a chart that shows the trend in the Bitcoin
fear and greed index over the past year: The crypto fear and greed
index seems to have sunk to extreme fear values | Source:
CryptoQuant As you can see in the above graph, the indicator has
now dipped to a value of 15. This is the lowest the metric has gone
since July of the previous year. Related Reading | Start Of
Bear Period? Current Bitcoin Trend Looks Similar To June
Incidentally, the day in July when such low values occurred was
also around when the Bitcoin price bottomed out. However, the quant
in the post notes that this doesn’t necessarily mean that the
current price has hit a bottom as well. Following the May crash,
the months of May and June also observed similar extreme fear
sentiments multiple times. So, it’s rather possible that the
current low values of the indicator may persist for a while, just
like back then, before the price finds its way back up. BTC Price
At the time of writing, Bitcoin’s price floats around $42.4k, down
12% in the last seven days. Over the past month, the crypto has
lost 16% in value. The below chart shows the trend in the price of
BTC over the last five days. After the crash down to $42k a few
days back, BTC's price further plunged down to $41k yesterday |
Source: BTCUSD on TradingView Featured image from Unsplash.com,
charts from TradingView.com, CryptoQuant.com
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