The Crypto Fear and Greed Index, a measure of market sentiment in direction of cryptocurrencies, has surged to its highest stage this yr, reaching a rating not seen since November 2021 when Bitcoin hit its all-time excessive.
The index, which ranges from 0 to 100 and is predicated on components corresponding to volatility and buying and selling quantity, displays rising optimism and confidence amongst traders as BTC exceeds $28,000.
The spike within the index means that merchants are feeling extra bullish about the way forward for cryptocurrency markets, regardless of latest regulatory issues and market volatility.
Crypto Fear & Greed Index: Bullish Sentiment In Wake Of Banking Crisis
Bitcoin has skilled a big surge in worth, with its worth rising almost 30% to achieve $28,500 in only one week. At the time of writing, BTC was buying and selling at $28,122, up 16.3% within the final seven days, knowledge from crypto market tracker Coingecko exhibits.
Source: Coingecko
This uptick in efficiency has additionally had an affect on the Bitcoin Fear and Greed Index, which analyzes a spread of things, together with worth volatility, social media exercise, and surveys to gauge investor sentiment towards BTC.
Presently, the index stands at 68, indicating a state of “Greed.” This stage was final noticed in mid-November 2021, shortly after Bitcoin achieved its highest-ever recorded worth, surpassing $69,000.
When the Crypto Fear and Greed Index is excessive, specialists might warning that the market is overbought and due for a correction. They may additionally warn that investor sentiment has grow to be excessively optimistic, which may result in a market bubble and a subsequent worth crash.
Source: Alternative.me
Additionally, specialists might advise traders to train warning and never get caught up within the hype of a market rally, as costs might be topic to important fluctuations.
Experts warn, nonetheless, that whereas a excessive Crypto Fear and Greed Index might point out constructive sentiment, it shouldn’t be the only real consider making funding choices. It is necessary for traders to conduct thorough analysis and contemplate a wide range of components earlier than making any funding choices.
Bitcoin As Top Performing Asset
Recent knowledge from Goldman Sachs exhibits that Bitcoin has surpassed traditional investment assets and sectors when it comes to absolute returns and risk-adjusted efficiency.
Specifically, the main cryptocurrency has gained 51% in year-to-date (YTD) absolute returns, surpassing each gold and the S&P 500, which have solely gained 4% every over the identical interval.
BTC whole market cap now at $531 billion on the each day chart at TradingView.com
This surge in Bitcoin’s worth is attributed to the rising chance of the US Federal Reserve altering its financial coverage. In reality, since March 10, when regulators shut down Silicon Valley Bank, Bitcoin has elevated by 35%.
While market analysts have cautioned a few doable correction, the cryptocurrency has rebounded extra strongly than Wall Street shares, making it a lovely choice for traders.
-Featured picture from Frank Sonnenberg Online
