Data shows that Bitcoin sentiment is nearly in the intense fear zone. Here’s what this might mean for the asset’s price.

Bitcoin Fear & Greed Index Is Currently Sitting Deep Inside ‘Fear’

The “Fear & Greed Index” is an indicator created by Alternative that tells us concerning the general sentiment among the many investors of Bitcoin and other top cryptocurrencies.

The index represents the sentiment as a rating on a scale between zero to hundred, which it determines using the next five aspects: volatility, trading volume, social media sentiment, market cap dominance, and Google Trends.

When the indicator has a price greater than 53, the traders share a sentiment of greed. However, it being under 47 implies the presence of fear out there. Naturally, the region between the 2 cutoffs corresponds to a net-neutral mentality.

Now, here is where the Bitcoin market stands at once based on the Fear & Greed Index:

Looks just like the index has a price of 26 in the intervening time | Source: Alternative

As is visible above, the Bitcoin Fear & Greed Index has a price of 26 at once, which implies the market is deep into the fear zone. The metric is true on the boundary of a special region generally known as extreme fear.

Extreme fear occurs when the indicator reaches a price of 25 or lower and represents a state of immense distress amongst investors. An identical but opposite zone for the greed side, called extreme greed, occurs at 75 and better.

The newest market sentiment contrasts to that only around every week ago, when the index still signals “greed values.” The below chart shows how the indicator’s value has modified over the past yr.

The worth of the metric appears to have been relatively low recently | Source: Alternative

The present fearful market is natural because Bitcoin has registered one other drop, with its price slipping under $58,000 this time. If history is anything to go by, this development will not be entirely bad for the asset.

BTC has tended to maneuver in the other way from what the bulk expect, and the probability of such a contrary move has only increased the more the investors have turn out to be sure of the asset’s direction.

This expectation is the strongest inside the intense sentiment zones, so it’s no surprise that major tops and bottoms have generally formed when the index has been in these regions.

For the reason that Fear & Greed Index has been on the sting of the intense fear zone in the course of the previous few days, a fall may occur in the approaching days, leading towards a possible bottom for Bitcoin. That is barely if the value doesn’t show a sudden sharp turnaround from here.

BTC Price

Bitcoin had recovered above $59,000 earlier within the day, however the recovery was quite short-lived because it is already right down to $57,700.

The worth of the asset appears to have plunged | Source: BTCUSD on TradingView

Featured image from Dall-E, Alternative.me, chart from TradingView.com