Crypto Fear and Greed Index Rises to 16-Month High as Bitcoin Breaks $28,000
The Crypto Fear and Greed Index, a measure of market sentiment towards cryptocurrencies, has risen to its highest level this year, reaching a score not seen since November 2021 when Bitcoin reached its all-time high.
The index, which ranges from 0 to 100 and is based on factors such as volatility and trading volume, reflects growing optimism and confidence among investors as BTC surpasses $28,000.
The spike in the index suggests traders are feeling more optimistic about the future of cryptocurrency markets, despite recent regulatory concerns and market volatility.
Crypto Fear & Greed Index: Bullish sentiment in wake of banking crisis
Bitcoin has experienced a significant increase in value, with its price rising nearly 30% to reach $28,500 in just one week. At the time of writing, BTC was trading at $28,122, up 16.3% in the past seven days, data from crypto market tracker Coingecko shows.
Source: Coingecko
This increase in performance has also had an impact on the Bitcoin Fear and Greed Index, which analyzes a number of factors including price volatility, social media activity and surveys to gauge investor sentiment towards BTC.
Currently, the index stands at 68, indicating a state of “Greed”. This level was last observed in mid-November 2021, shortly after Bitcoin reached its highest ever recorded value, surpassing $69,000.
When the Crypto Fear and Greed Index is high, experts may warn that the market is overbought and due for a correction. They can also warn that investor sentiment has become overly optimistic, which could lead to a market bubble and subsequent price crash.
Source: Alternative.me
Additionally, experts can advise investors to exercise caution and not get caught up in the hype of a market rally, as prices can be subject to significant fluctuations.
However, experts caution that while a high crypto fear and greed index may indicate positive sentiment, it should not be the sole factor in making investment decisions. It is important for investors to conduct thorough research and consider a number of factors before making investment decisions.
Bitcoin as a top performing asset
Recent data from Goldman Sachs shows that Bitcoin has outperformed traditional investment vehicles and sectors in terms of absolute return and risk-adjusted performance.
Specifically, the leading cryptocurrency has achieved 51% year-to-date (YTD) absolute returns, outperforming both gold and the S&P 500, which have only gained 4% each over the same period.
BTC total market cap now at $531 billion on the daily chart at TradingView.com
This increase in Bitcoin’s price is attributed to the increasing likelihood of the US Federal Reserve changing its monetary policy. In fact, since March 10, when regulators shut down Silicon Valley Bank, Bitcoin is up 35%.
While market analysts have warned of a possible correction, the cryptocurrency has rebounded more strongly than Wall Street stocks, making it an attractive option for investors.
– Featured image from Frank Sonnenberg Online
