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After the new Bitcoin high of $111,000, data indicates that Bitcoin’s market sentiment is now extreme.
Bitcoin Fear & Greed Index Has Shot Up Recently
The “Fear & Greed IndexThe indicator ” is a product of Alternative This metric tells us the general sentiment of the Bitcoin market and the wider crypto markets. This metric represents sentiment using a scale of 0-100. Investors are more likely to be greedy if their values exceed 53, and fearful if they fall below 47. Between these two cutsoffs, the index indicates that investors have a net-neutral mentality.
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Besides these three main zones, there are also two ‘extreme’ regions called the extreme greed (above 75) and extreme fear (below 25). At present, the market sentiment is inside the former of the two, according to the latest value of the Fear & Greed Index.
In the past, extreme emotions have had a great deal of significance in Bitcoin and digital assets. This is because they are where most major tops or bottoms tend to occur. Relationship has always been an inverse One, on the other hand, means that a bullish mood makes it more likely for tops to occur and a depressed atmosphere will lead to bottoms.
This fact is exploited by some traders to help them time their purchases and sales. Contrarian investing is the popular name for this trading strategy. Warren Buffett’s famous quotation sums it up: “be fearful when others are greedy, and greedy when others are fearful.”
Bitcoin’s sentiment is now returning to extreme greed, and it could be that those who follow this philosophy are starting to turn away.
That said, the Fear & Greed Index has a value of ‘just’ 78 at the moment. Comparatively, December’s peak was around 87 while January’s peaked at 84. The metric reached a higher peak in November, 94.
It’s therefore possible that, in the short term, the market is not quite as overheated, at least in terms of the sentiment, provided that investors’ demand doesn’t slow down. The only thing left to see is how Bitcoin and the other cryptocurrencies will evolve in this environment of extreme greed.
In an X message, Maartunn from CryptoQuant’s community analysts pointed out that whales had just withdrawn a substantial amount of money on Binance. post.
This indicator is called the “Exchange Netflow“, tells us the amount of Bitcoin moving in or out of wallets that are associated with Binance, a central exchange.
Binance Exchange Netflow is clearly a very negative value. This means that a lot of investors have moved coins from the exchange. Net outflows on the Binance platform were 2,190 BTC, or approximately $237 million.
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It could be a sign that big investors are HODLing cryptocurrency on self-custodial storage wallets.
BTC Price
Bitcoin’s price is currently hovering around $108,400. This represents an increase of 4% over the last week.
Chart from TradingView.com. Image from Dall E, CryptoQuant.com and Alternative.me.
“This article is not financial advice.”
“Always do your own research before making any type of investment.”
“ItsDailyCrypto is not responsible for any activities you perform outside ItsDailyCrypto.”
Source: www.newsbtc.com
