- Fear and Greed Index now stands at a level of 79, which shows that crypto markets are overbearing at the moment.
- While the price of Bitcoin is now close to $100,000, this continues to drive market emotions.
- New investors should be especially careful because natural greed appears just before high volatility and potential corrections.
As shown in the most recent Fear and Greed Index available right now, the cryptocurrency market is still riding high on an unyielding wave of greed. The index which takes into account multiple factors in assessing market mood has risen to 79, meaning that the market is in the state of ‘’Extreme Greed.” Such a major step provides certain information on the current state of the market condition and the tendencies that may appear in the near future.
Market Sentiment: What Drives the Fear and Greed Index?
The Fear and Greed Index represents a value between 0 and 100; high values pointing towards greed while the low scale showing fear. This is an average of 79 which puts the market on the slippery slope of extreme greed, this is a testimony of high level confidence by investors within the market and strongly bullish sentiment.
The index sums up various values such as the market fluctuation factor, the trading volume factor and the social media factor, the survey factor and others. The present era of high greed may be attributed to high price performance, media coverage, and positive outlook by industry gurus.
Bitcoin Nears $100,000 Mark
As the index reached its all-time high, the price of Bitcoin is at $99,377 close to the $100K psychological level. This outstanding low price level shows the interest of people towards diverse investments in cryptocurrency. But, such a high mindset provokes the concerns regarding market stability and possible threats.
Although when a Fear and Greed Index reaches extreme levels, usually high, we found it to be a rather effective tool, it is still a warning sign. In the case of the extremes of greed, investors are always warned to exercise extra care because usually markets are overbought. The increased volatility levels can actually be managed if the organization bothers to diversify and undertake long term strategic plans. While markets reach closer and closer to the $100,000 for Bitcoin, parties remain encouraged to be wary.
