Bitcoin Market Sentiment Reaches Neutral
• Bitcoin price has dropped below the $22,000 level and the Fear and Greed Index now points at a “neutral” sentiment.
• Values of the index higher than 50 mark indicate that the market is greedy, while those lower than 50 imply investors are fearful.
• The longest ever streaks of fear and extreme fear in the history of Bitcoin have finally come to an end earlier this year due to a rally in its price.
Fear And Greed Index
The “fear and greed index” is an indicator used to measure general sentiment among investors in the Bitcoin market. It uses a numeric scale that runs from 0-100 to display sentiment levels, with values above 50 suggesting greed, those below representing fear, and 46-54 being considered as “neutral”. Special sentiments of “extreme greed” (index > 75) and “extreme fear” (index < 25) are also monitored by traders, as tops and bottoms in the price of Bitcoin have historically tended to take place during these times.
Current Market Sentiment
Currently, the Bitcoin fear and greed index has a value of 48 which suggests that investors have a neutral sentiment with a slight lean towards fear. This is lower than what was seen recently when the market had been quite greedy. Over the past year both these streaks were some of the longest ever recorded; however they came to an end earlier this year when there was finally a rally in its price.
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Conclusion
The current decline in Bitcoin’s price has resulted in its Fear & Greed Index dropping below 50 – indicating that investor sentiment has shifted towards neutrality – although there still remains some lean towards fearfulness. Although such extreme sentiments have historically indicated tops/bottoms within its price fluctuations; previous streaks have been broken due to rallies earlier this year resulting in renewed optimism for potential profits within cryptocurrency investments.