Extreme fear is in the minds of investors because of the drastic fall in bitcoin prices after the dip of May. The fear and greed index has proved that the market trend is towards the negative side in comparison to the positive side.
The crypto market is battling with the most crucial phase to date in the history of cryptocurrency. The market has not seen any such situation in the past and has an extreme fear of losing the market position. The market is evolving so it is eventually bad for it on the whole.
Bitcoin has taken a dip in the lowest phase of the market recently and following this it was assumed that the market has gone into the bear phase. But similar is not true because the market geared up in recent times and many new giants have helped the market to gain through a little. The investments are being made and similar is being done with time.
When the number of coins entering into the exchange is compared with that of leaving the same it is observed that the price of BTC that is observed is only in its initial phase. It should not be taken as to be the final market price of bitcoins.
Skewing of Fear & Greed Index Into Greed
The fear and greed index shows qualitatively and quantitatively the behavior of investors in the market. When the market has the fear phase that generally means that people are less prone to believing the market situation. They doubt their investment and find new ways to make the gains. The term greed is completely opposite to it favoring the investment into the market.
The present developments that are seen now in the market can be perceived from the fact that the index has moved to the greed phase. The market was in the fear stage since May and has now seen development. This is a positive sign as far as market conditions are concerned.
This index does not put forth the actual relation between fear or greed with the market. It is just a method to get an idea about the market conditions in short. The phase over greed is also in the index that means that the investors are investing haphazardly without knowing or predicting the results. They only want gain and have little towards the market future. The short-term gains are more concentrated.
Movement of the price of Bitcoin
Despite the fact that the fear and greed index shows a green signal to the investment, the price of bitcoin has not seen gaining its value. The value of bitcoin is stuck as it has come to a point of saturation.
Bitcoin’s price broke open the $46K threshold value. But afterward, the value fell badly to $45K again. If the prices of the same in the recent times can be seen one can easily understand the value being stuck with a little or completely no movement. This cannot be related to the value getting stuck forever at this point as discussed earlier. The trends are already seen that the value before reaching a summit has taken a complete rest following which it takes off to the sky. In the case of BTC, a similar can be predicted and assumed for the welfare of the market.
With the dominance of BTC around 47%, the value is still held at the previous point and continues to remain at the same site. Let’s hope that everything returns to normal making easy access for BTC to the world of gains.