Following the Bitcoin and wider crypto crash, buyers available in the market are actually extra fearful than they have been throughout Black Thursday in March 2020.
Crypto Concern And Greed Index Now Has An Excessive Concern Worth of “7”
The “concern and greed index” is an indicator that tells us in regards to the normal market sentiment amongst crypto buyers proper now.
The metric makes use of a numeric scale that runs from zero to hundred for representing this sentiment. All values of the index beneath fifty indicate that buyers are fearful in the mean time, whereas these above the edge imply they’re at present grasping.
Indicator values of greater than 75 and fewer than 25 signify sentiments of utmost greed and excessive concern, respectively.
Now, here’s a chart from the weekly Arcane Analysis report from yesterday that exhibits the development within the crypto concern and greed index over the previous 12 months:
Seems like the worth of the metric has plunged down in latest days | Supply: Arcane Analysis's The Weekly Replace - Week 23, 2022
As you may see within the above graph, the crypto concern and greed index has been within the “excessive concern” territory for some time now.
In actual fact, this streak of utmost concern, which has been working for 57 straight days now, is the longest the indicator has ever noticed.
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Additionally, on the time the report was launched (which is yesterday), the index had a price of 8, which was the bottom worth since March 2021.
This sentiment was really worse than the Black Thursday occasion from again then (which occurred because of the COVID-19 pandemic).
At this time, the crypto concern and greed index has additional dropped in worth, now displaying simply 7.
The sentiment within the crypto market now appears to be the worst it has been since 2019 | Supply: Various.me
Traditionally, excessive concern intervals have been when cash like Bitcoin have bottomed out, and excessive greed stretches has been when tops have tended to type.
Due to this, some buyers take into account very low sentiment values to be best shopping for alternatives. As Warren Buffet’s well-known quote says, “be fearful when others are grasping, and grasping when others are fearful.”
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The report notes, nevertheless, that whereas shopping for has been worthwhile in such occasions earlier than, catching a falling knife like now isn’t a simple process.
On the time of writing, Bitcoin’s worth floats round $21.1k, down 30% within the final seven days. Over the previous month, the crypto has misplaced 30% in worth.
The beneath chart exhibits the development within the worth of the coin over the past 5 days.
The worth of Bitcoin has crashed down over the previous few days | Supply: BTCUSD on TradingView
Featured picture from Unsplash.com, charts from TradingView.com, Arcane Analysis