With the price of bitcoin now exceeding $49,000 and other crypto assets on the rise, traders are currently experiencing a period of “extreme greed,” according to a well-known index measuring market sentiment (source).
The Fear & Greed Index, published by data source alternative.me, measures market enthusiasm for bitcoin and other prominent digital assets. The last time the index reached a score of 79 out of 100 was when bitcoin hit its all-time high around $69,000 in November 2021.
According to the alternative.me website, “When investors are getting too greedy, that means the market is due for a correction.”
It’s widely believed in the market that astute traders prefer buying when the index shows extreme fear, and that they become more cautious when greed is higher. However, this may not always be the case.
The index has consistently been above 70 (the threshold for “greed”) since October of last year. It dropped as low as 50 following the approval of bitcoin ETFs in January, which initially turned out to be a “sell-the-news” event.
In the last 12 months, the price of bitcoin has more than doubled. A year ago, one coin was worth as little as $21,000, and yesterday, the price briefly rose above $50,000, but has since retreated to $49,400 at press time.
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- Source: https://cryptoinfonet.com/bitcoin-news/crypto-fear-and-greed-index-reaches-peak-not-seen-since-bitcoins-2021-all-time-high/
