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As Bitcoin's price surpassed $51,000 and other cryptocurrencies followed suit with notable gains, market sentiment has reached a level of “extreme greed,” according to the Fear & Greed Index, a well-known indicator of investor sentiment in the crypto space.
Crypto Fear and Greed Index Reaches Highest Level Since Bitcoin's 2021 Record High
The Fear and Greed index, which combines market momentum, volatility, volume and social media data, reached its highest level since Bitcoin rose to an all-time high of $69,000 in November 2021, with a score of 79 out of 100.
Although not definitive, the scores here are interpreted as follows:
Extreme fear can be a buying opportunity as it indicates that people are very worried and the price is at the bottom. Excessive greed could mean a correction in the market.
The Fear and Greed Index has generally remained above 70, the “greed” threshold, since October last year.
Notably, it briefly dropped to 50 following the approval of Bitcoin ETFs in January, an event that initially triggered a “sell the news” reaction from investors.
Bitcoin's remarkable price performance over the past year underscores the ongoing upward trend in the crypto market.
Just a year ago Bitcoin was trading at $21,000. Today, it is trading above $51,000.
*This is not investment advice.