Recent data from the Fear & Greed Index shows the crypto market is going through a period of extreme fear, with its lowest reading in recent months at 21/100. This is a tool that analyzes current sentiment and market trends using the leading crypto asset Bitcoin as a proxy.

Source: alternative.me

This indicator can – in conjunction with other analytical strategies – be used to determine the possibility of a future rally or correction and to see whether price levels represent a buying or selling opportunity.

A number further from 100 indicates more fear in the market and BTC could be undervalued, while a number closer to that level represents extreme market greed and a possible overvalued price, anticipating a future decline.

After Bitcoin fell more than 10% below the $ 40,000 region last night, the Fear & Greed index fell to 21 at press time.

Source: TradingView

The index hit a one-year low with a score of 10 on July 21, followed by a parabolic rally to a five-month high of 79 in late August-early September prices with regular double-digit returns.

Reddit user u / _DEDSEC_ adapted the popular trading mantra “buy the rumor, sell the truth”, commenting that traders should “buy when they are afraid, sell when they are greedy”.

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Annie

According to Cointelegraph

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