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The Crypto Fear and Greed Index has witnessed a sharp fall throughout August, which then accordingly indicated both ‘fear’ and ‘extreme fear’ among cryptocurrency investors.
The Fear Index has been trading at its 244-day low (the lower the index is, the more full of fear the market is) this week which was, unfortunately, the level of the Fear Index when Bitcoin crashed to $3,000 in December 2018.
Bitcoin and other cryptocurrencies have recovered significantly in 2019. However, crypto investors and traders have been observing the market nervously as market sentiments have appeared to take a U-turn for a speculated bearish market as the Index dropped to its lowest level since last year. Global issues such as the U.S.-China trade war, slowing global demand, and Brexit uncertainty are some of the reasons which are driving the current markets.
Bitcoin’s price has been moving around $10,000 for a few weeks and many are hoping that the largest cryptocurrency might be the ideal vehicle to park their money considering the global geopolitical uncertainty and economic slowdown.
The Crypto Fear and Greed Index is currently showing 30, but it fell to 11 earlier this month, which stirred some panic among cryptocurrency investors and traders. The Fear Index was trading at its peak in June when the social media giant Facebook announced the development of its native digital currency Libra. However, Libra has been facing many political and regulatory obstacles in the U.S. and since then the Index has been experiencing the massive fall.
The Crypto Market Shed $30 Billion in Just Several Days
When the Index fell to record low, the price of Bitcoin also took a dive of a few percent as the entire crypto market has witnessed the whopping loss of $30 billion over the course of mere several days. What caused even further alarm and dismay was that Bitcoin dropped below the important key point of $10K last week; it has jumped above it since then, but this is yet a psychological border that as crossed.
The Crypto Fear and Greed Index was created by the website and software comparison company Alternative.me. the Index gives hints about daily market sentiments and measures them on a scale of 0 to 100. It considers a few pertinent parameters such as volatility, trends, market volume, social media, dominance, etc. for calculation. Zero indicates a situation of panic (‘Extreme Fear’) and a negative market sentiment while 100 indicates a situation of radical confidence (‘Extreme Greed’).