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Crypto Market Fear and Greed Index

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Crypto Fear and Greed Index 28/02/2024.

Each day, we analyze emotions and sentiments from different sources and compress them into a simple number: The Fear & Greed Index for Bitcoin and other cryptocurrencies. See how the Bitcoin Fear and Greed Index chart is today.

Crypto Market Fear and Greed Index

How to read the value and the Fear and Greed graph?

The Fear and Greed Index values ​​range from 0 (extreme fear) to 100 (extreme greed).

The chart works as follows:

  • 0 - 24 = extreme fear
  • 25 - 49 = Fear
  • 50 - 74 = Greed
  • 75 - 100 = extreme greed

How is the fear and greed index calculated?

The Bitcoin & Crypto Fear and Greed Index is updated every 8 hours (around 00:00, 08:00 and 16:00 UTC).

To calculate the fear and greed index, we collected data from 5 different sources.

Each source has a unique “weight” assigned to it, to represent the importance in estimating market sentiment.

What is the Cryptocurrency Fear and Greed Index?

The Crypto Fear and Greed chart is an index created to measure investors' greed and fear in the cryptocurrency marketđŸ‡§đŸ‡· It is used to analyze investor behavior in the cryptocurrency market.

When important market events occur, whether positive or negative, investors receive news promptly and can make decisions immediately without having to wait for the market to open during business hours.

When there is a flow of demand to buy or sell in this market 24/7, the Crypto Fear and Greed Index is used to analyze investor behavior to help improve the decision-making process.

Crypto Fear and Greed Index

  1. The Crypto Fear and Greed Index ranges from 0 to 100, where 0 represents the state of extreme fear among investors, which can cause strong selling pressure.
  2. The value of 100 has the opposite meaning: investors are getting extremely greedy. There may be some FOMO-induced buying impulse.

How does the Crypto Market Fear and Greed Index work?

When the Crypto Market Fear and Greed Index is approaching or in the "extreme greed“This means that longs are getting very greedy and the market is late to make a correction.

Likewise, we can say that when the Crypto Market's Fear and Greed Index is in the “extreme fear“Traders are very scared and this may cause a trend reversal soon.

1. Volatility

We are measuring current and max volatility. bitcoin withdrawals and compare them with the corresponding average values ​​for the last 30 days and 90 days. We argue that an unusual increase in volatility is a sign of a fearful market.

2. Moment / market volume

In addition, we are measuring current volume and market dynamics (again compared to the last 30/90 day average values) and we put these two values ​​together. Generally, when we see high buying volumes in a positive market on a daily basis, we conclude that the market is acting excessively greedy / bullish.

3. Dominance

The dominance of a currency resembles the market share of the entire cryptography market. Especially for Bitcoin, we think that an increase in Bitcoin dominance is caused by the fear of (and therefore a reduction in) speculative investments in alternative currencies, as Bitcoin is increasingly becoming the safe haven of cryptography. On the other hand, when Bitcoin's dominance declines, people become more greedy investing in riskier alternative currencies, dreaming of their chance in the next big bull run. Anyway, analyzing the dominance of a currency other than Bitcoin, you could argue the opposite, as more interest in an alternative currency can lead to bullish/greedy behavior for that specific currency.

4. Trends

We took Google Trends data for various Bitcoin-related search queries and analyzed those numbers, especially changing search volumes as well as other popular searches currently recommended. For example, if you check Google Trends for “Bitcoin” , you won't be able to get much search volume information. But currently you can see that there is an increase of +1.550% in the query „bitcoin price manipulation“ in the related search queries box (as of 29/05/2018). This is clearly a sign of fear in the market, and we use this for our index.

5. Social media (Reddit and Twitter)

We've gathered tweets and Reddit posts/comments mentioning Bitcoin and other cryptocurrencies and analyzed the sentiment of those posts. Overall, bullish tweets/posts (such as “Bitcoin is going to the moon”) indicate a greedy market sentiment and bearish posts (such as “Bitcoin has no adoption and rates are too high”) indicate fearful market sentiment.

Why measure the fear and greed of the crypto market?

The crypto market has very emotional behavior. People tend to get greedy when the market is going up, which results in FOMO (fear of losing). Also, people often sell their coins in irrational reaction to seeing red numbers. With our Fear and Greed Index, we try to save you from your own emotional overreactions. There are two simple assumptions:

  1. O extreme fear it could be a sign that investors are very concerned. This can be a purchase opportunity.
  2. When investors are getting very greedy, that means the market need a fix.

So we took a look at the current Bitcoin market sentiment and turned the numbers into a simple gauge from 0 to 100. Zero means “extreme fear” while 100 means “extreme greed”. See below for more information about our data sources.