The Crypto Fear & Greed Index has revealed that investors are fearful of cryptocurrency markets, with a score of 27/100 for the last three months.
The seasoned technical analysis tool informs cryptocurrency traders around the world about the current sentiment and biases of the market by using the Bitcoin (BTC), the most popular cryptocurrency asset.
These data can then be used in conjunction with other analytical strategies to determine the potential for a future surge, correction and whether prices levels are an opportunity to sell or buy the market.
A lower number of 100 means that there is a shift toward extreme market fear. BTC could be undervalued. Conversely, a higher number indicates extreme market greed. Prices could be exaggerated above their true value and this could lead to a future decline.
The index scored 27 after Bitcoin’s 10% decline to $43,313 last week. It printed this figure almost three months ago, on the 26th of July.
The index fell to a 1-year low on July 21st with a score 10 and then rallied to 5-month highs at 79 in late August and early September. This volatility is common across the entire cryptocurrency market. Prices often print double-digits.
Related: Bitcoin rises to $43K before new crypto comments by SEC Chair Gensler
Reddit user, u/_DEDSEC_, adapted the trading mantra “buy the rumours, sell news” and commented that traders should be “buying the fear, selling the greed.”