The Bitcoin fear and greed index has started to quickly change to extreme greed as the crypto continues to rally up.
Bitcoin Fear And Greed Needle Starts Pointing At Extreme Greed
As per the latest weekly report from Arcane Research, the fear and greed index quickly turned to extreme greed values last week.
The “fear and greed index” is a Bitcoin indicator that shows the general crypto market sentiment at the time. The metric uses a numerical scale of one to hundred for displaying the different sentiments.
Values close to zero fall under the “extreme fear” category while values at the other end imply “extreme greed.” When the indicator shows neither too large, nor too low values, the sentiment falls under either “fear” or “greed” depending on which side around 50 the value is.
Now, here is a chart that shows how the indicator’s value has changed over the years for Bitcoin:
Looks like the crypto market has quickly turned greedy | Source: The Arcane Research Weekly Update – Week 40
As the above graph shows, the sentiment had turned greedy last week after a fearful September, and the values are now entering into the extreme greed category.
While the month of September had some moves up, it also had several price crashes, and that’s why the sentiment was that of fear for the most part.
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The indicator dipped all the way down to extreme fear on 30th September, but in under two weeks the sentiment has already rebounded back to extreme greed. The report notes that this shows how fast the sentiment can change among the crypto market.
Right now, BTC is showing some strong momentum upwards as the coin broke $58k for the first time since May today. An on-chain indicator shows that both the long-term holders and the short-term holders are in profit right now so it’s not a surprise that the market has started turning greedy.
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At the time of writing, Bitcoin’s price floats around $57.2k, up 6% in the last seven days. Over the last month, the crypto has gained 22% in value.
The below chart shows the trend in the price of the coin over the last five days:
Bitcoin’s price shows a lot of volatility while keeping up an overall upwards trend | Source: BTCUSD on TradingView
Usually, when the crypto market sentiment reaches the extreme greed territory, the market observes a correction at least in the short term. The BTC price did have a minor dip yesterday and the fear and greed values have left the extreme greed territory today as the indicator now points at greed.