Following the Bitcoin and wider crypto crash, buyers available in the market are actually extra fearful than they had been throughout Black Thursday in March 2020.
Crypto Fear And Greed Index Now Has An Extreme Fear Value of “7”
The “fear and greed index” is an indicator that tells us in regards to the common market sentiment amongst crypto buyers proper now.
The metric makes use of a numeric scale that runs from zero to hundred for representing this sentiment. All values of the index under fifty suggest that buyers are fearful in the intervening time, whereas these above the edge imply they’re at the moment grasping.
Indicator values of greater than 75 and fewer than 25 signify sentiments of maximum greed and excessive concern, respectively.
Now, here’s a chart from the weekly Arcane Research report from yesterday that reveals the development within the crypto concern and greed index over the previous yr:
Looks like the worth of the metric has plunged down in current days | Source: Arcane Research's The Weekly Update - Week 23, 2022
As you’ll be able to see within the above graph, the crypto concern and greed index has been within the “extreme fear” territory for some time now.
In truth, this streak of maximum concern, which has been working for 57 straight days now, is the longest the indicator has ever noticed.
Related Reading | Has Bitcoin Hit Bottom Yet? Here’s What On-Chain Data Says
Also, on the time the report was launched (which is yesterday), the index had a price of 8, which was the bottom worth since March 2021.
This sentiment was really worse than the Black Thursday occasion from again then (which occurred as a result of COVID-19 pandemic).
Today, the crypto concern and greed index has additional dropped in worth, now exhibiting simply 7.
The sentiment within the crypto market now appears to be the worst it has been since 2019 | Source: Alternative.me
Historically, excessive concern durations have been when cash like Bitcoin have bottomed out, and excessive greed stretches has been when tops have tended to kind.
Because of this, some buyers contemplate very low sentiment values to be supreme shopping for alternatives. As Warren Buffet’s well-known quote says, “be fearful when others are greedy, and greedy when others are fearful.”
Related Reading | Here’s What Would Happen If Bitcoin Breaks Below $20K, Arthur Hayes Predicts
The report notes, nonetheless, that whereas shopping for has been worthwhile in such instances earlier than, catching a falling knife like now isn’t a simple job.
At the time of writing, Bitcoin’s worth floats round $21.1k, down 30% within the final seven days. Over the previous month, the crypto has misplaced 30% in worth.
The under chart reveals the development within the worth of the coin over the past 5 days.
The worth of Bitcoin has crashed down over the previous couple of days | Source: BTCUSD on TradingView
Featured picture from Unsplash.com, charts from TradingView.com, Arcane Research