Bitcoin Sentiment Worst Since 2022 Bear As Price Crash Continues
Data reveals the Bitcoin Fear & Greed Index has continued to say no not too long ago, with its worth now hitting the bottom degree because the 2022 bear market.
Bitcoin Fear & Greed Index Is Deep Inside Extreme Fear Zone
The “Fear & Greed Index” refers to an indicator created by Alternative that tracks the typical sentiment current amongst merchants within the Bitcoin and wider cryptocurrency markets.
The index determines the dealer mentality utilizing the information of the next 5 components: buying and selling quantity, volatility, market cap dominance, social media sentiment, and Google Trends. To symbolize the sentiment, it makes use of a numerical scale operating from zero to hundred.
When the worth of the indicator is above 53, it means the traders as an entire share a sentiment of greed. On the opposite hand, the metric being underneath 47 suggests the dominance of worry. Naturally, the index mendacity between these two cutoffs implies a impartial mentality is shared by the bulk.
Besides these three important zones, there are additionally two ‘excessive’ areas known as the intense worry (25 and under) and excessive greed (above 75). After the latest market downturn, sentiment amongst cryptocurrency merchants has deteriorated into the previous of the 2.
Here is how the most recent worth of the Bitcoin Fear & Greed Index appears:
As displayed above, the Bitcoin Fear & Greed Index has a worth of 9 in the meanwhile, which is a fairly low degree. In truth, this degree is so deep into excessive worry that that is the primary time within the present cycle that the metric has reached it.
Below is a chart that reveals how the present degree of utmost worry traces up towards the indicator’s historic knowledge.
From the graph, it’s seen that the final time the Bitcoin Fear & Greed Index reached a worth this low was again in June 2022, proper in the midst of that yr’s bear market.
The newest drop within the metric to a single-digit worth is a results of the value drawdown that BTC and different cryptocurrencies have confronted because the final week of January. This decline in sentiment, nonetheless, is probably not such a nasty factor for the sector, if historical past is to go by.
Often, a particularly fearful market facilitates bottom formations as underwater traders capitulate and resolute arms choose up their cash. During a bear market, nonetheless, the Fear & Greed Index is normally contained in the zone for a notable length earlier than a backside is reached.
If the latest shift within the sector displays a transition to a bear market, then it solely stays to be seen how lengthy temper might be in excessive worry earlier than aid arrives for Bitcoin and firm.
BTC Price
At the time of writing, Bitcoin is floating round $67,100, down 19% during the last seven days.