15.8 C
Manchester
June 26, 2022
Image default
Guide & Analysis

Bitcoin’s Fear and Greed Index Returns to Enthusiasm

Over the past ten days, the Fear and Greed index in the bitcoin and cryptocurrency markets has been very positive.

Market returns to create new expectations, as the bitcoin’s fear and greed index returns to enthusiasm.

For example, today, on a scale from zero to one hundred, the detected value is 73 .

Since zero corresponds to maximum fear, while one hundred corresponds to maximum greed (or enthusiasm), the cryptocurrency market is currently in the zone of “greed”, but without excesses.

Generally, greed is considered extreme when it exceeds 75, while more than 80 can be considered excessive.

During 2021 the value of this index remained more or less constantly positive until May 12, with extreme peaks between January and February, even in 95.

As of mid-May, however, he entered heavy negative territory, playing 10 several times through the end of July.

Interestingly, the price of bitcoin during the year never dropped below the highs of the previous year. Still, despite this, for about two months, the cryptocurrency market was dominated by extreme fear, probably excessive.

The fear and greed index during 2021

On the other hand, in the early months of the year, it was enthusiasm to be excessive, perhaps contributing in large part to bringing bitcoin price to the historic highs of mid-April.

Generally, when enthusiasm is excessive, it means that the markets are overvaluing cryptocurrencies, so much so that a downturn can be suspected. Instead, a level of 73 points does not seem to suggest that there is real over-enthusiasm going on, so much so that it has generated excessive price growth. However, that doesn’t mean they can’t fall further.

On the other hand, this mood of enthusiasm that has been breathed for about ten days now in the cryptocurrency markets, and which in turn has been preceded by about ten days in which the fear and greed index has remained substantially in the neutral zone, seems to suggest that positive expectations are shared regarding the prices of bitcoins and cryptocurrencies in the short or medium term.

Note that several months ago, it was hypothesized that the current level of $45,000 could have served as a support for the bitcoin price, but then began a bearish phase that only ended on July 21st. It is possible that once the bearish phase ended, this level returned to act as a support and, according to the authors of these hypotheses, the next target for the BTC could be US$70,000.

However, it is not impossible that a new downturn is triggered, but this last hypothesis does not seem to gather many supporters in the short term.

Source: cryptonomist

Related posts

Bitcoin is back in the $ 10,000 range! What can we expect ahead?

Shahrukh Ahmed

Almost two million ETH could be burned in the next year

Shahrukh Ahmed

Bitcoin struggling for $ 50,000: DOGE recovers 30%

Shahrukh Ahmed

Leave a Comment