view dashboard view dashboard

Bitcoin Fear and Greed Index

Data & charts updated every hour - Get 10 seconds

Updated 50 minutes ago

Fear & Greed index

Historical Fear & Greed with Bitcoin Price

Data from alternative.me

Bitcoin Fear and Greed Index Chart Explained

The Bitcoin Fear and Greed Index is a tool used to analyze market sentiment in the cryptocurrency space. It helps identify when the market is experiencing excessive fear, which might indicate undervaluation, or excessive greed, suggesting potential overvaluation.

The chart displays Bitcoin's price, highlighting its position on the fear and greed scale. Red and orange colors signify a more fearful market sentiment, while green indicates a more optimistic or bullish outlook.

Understanding the Fear and Greed Index

This index measures investor sentiment in the crypto market using a combination of six indicators. It provides a score from 0 to 100, where lower scores reflect fear and higher scores indicate greed. This helps investors understand market trends and make better trading decisions.

Origin and Adaptation

Initially created by CNNMoney for the stock market, the Fear and Greed Index was adapted for cryptocurrencies by Alternative.me. It serves a similar purpose by evaluating market sentiment to determine whether conditions are bullish or bearish.

Components of the Index

The crypto version of the index uses six key indicators:

  • Volatility: Measures recent price changes to assess market stability. High volatility often signals fear.
  • Market Momentum and Volume: Compares current data with historical averages to evaluate trend sustainability. High values suggest greed.
  • Social Media: Analyzes sentiment on platforms like Twitter and Reddit. Increased activity often aligns with greed.
  • Dominance: Looks at Bitcoin's share of the total crypto market cap. Higher dominance can indicate a cautious market.
  • Trends: Monitors Google search trends related to Bitcoin, reflecting investor interest. Spikes in searches often match market volatility.
  • Surveys: Weekly polls capture direct investor sentiment, influencing the index score.

Interpreting the Index

The index ranges from 0 (extreme fear) to 100 (extreme greed). High values may suggest an overbought market, while low values could indicate oversold conditions, offering potential buying opportunities.

Using the Index

Investors use the index to guide their strategies. High scores might prompt caution or selling, while low scores could signal a good time to buy.

Limitations

While useful, the index is based solely on sentiment and lacks technical or fundamental analysis. It should be used alongside other tools for a comprehensive market evaluation.

Video Explanation

DISCLAIMER
Any information found on this page is not to be considered as financial advice. You should do your own research before making any decisions.

Get More From Bitbo

View Private Charts

Get Alerts When We Launch New Charts