Market sentiment drives the cryptocurrency market trends. There are two simple assumptions – most investors get greedy when the market is bullish, while fear results in bearish trends, making them panic sell when the value of crypto assets (primarily Bitcoin’s price) drops sharply.
The Crypto Fear and Greed Index aim to take human psychology into account and analyze the crypto market behaviour to help crypto investors forecast the course of the price action and make informed trading decisions by putting the general market sentiments into perspective.
If people behave the same way in certain contexts, is it possible to profit by being “fearful when others are greedy and greedy when others are fearful,” as quoted by world-renowned investor Warren Buffet?
The Fear and Greed Index was created to answer this question by providing insights into the general sentiments of the crypto markets.
Let’s get right to it!
What Is Crypto Fear and Greed Index