Data reveals the Bitcoin concern and greed index has now reached the best stage for the reason that peak in November because the price of the crypto rallies up.
Bitcoin Fear And Greed Index Now Points At “Greed”
As per the newest weekly report from Arcane Research, the BTC concern and greed index has surged to values of greed sentiment this week.
The “fear and greed index” is an indicator that tells us in regards to the present basic market sentiment amongst Bitcoin traders.
The metric makes use of a numeric scale that travels from one to hundred for representing this sentiment. All values above fifty signify that traders are grasping for the time being. While these under the cutoff counsel a fearful market.
Values above 75 and under 25, that’s, the values towards the ends of the vary, signify excessive greed and excessive concern, respectively.
Now, here’s a chart that reveals the pattern within the Bitcoin concern and greed index over the previous 12 months:
Looks like the worth of the indicator has surged up not too long ago | Source: Arcane Research's The Weekly Update - Week 12, 2022
As you may see within the above graph, the Bitcoin concern and greed index has sharply risen over the previous week. The indicator now has a worth of 56, which reveals the market is getting grasping.
This worth of the metric is now greater than in every other interval within the 12 months 2022 thus far, and is the best for the reason that peak in early November of final 12 months.
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Historically, Bitcoin peaks have tended to occur whereas the sentiment is that of utmost greed, and bottoms have shaped in periods of utmost concern.
There is a well-liked buying and selling approach referred to as “contrarian investing” that makes use of this reality. Traders following this technique assume that the very best time to purchase is throughout excessive concern, whereas excessive greed is when one ought to promote.
Related Reading | Bitcoin Weekly Momentum Flips Bullish For First Time In 2022: What Data Says
This well-known quote by Warren Buffet sums up this philosophy: “Be fearful when others are greedy, and greedy when others are fearful.”
So, following the road of pondering of contrarian traders, the present market sentiment turning grasping could also be an indication that you must now begin getting fearful as an alternative.
At the time of writing, Bitcoin’s price floats round $47.3k, up 12% within the final seven days. Over the previous month, the crypto has gained 26% in worth.
The under chart reveals the pattern within the price of the coin during the last 5 days.
The price of Bitcoin appears to have surged up over the previous few days | Source: BTCUSD on TradingView
Featured picture from Unsplash.com, charts from TradingView.com, Arcane Research