Good evening. Bitcoin has essentially been making consistent gains over the last couple of days. As I write, 1 BTC = $43,869 USD and BTC is up 1.96% over the last 24 hours and up 7.27% on the week. And, at ~ 8:00 PM New York City time tonight Thursday, March the 24'th, the infamous Twitter account Bitcoin Fear and Greed Index @BitcoinFear posted that a score = 47. That's the highest since March 2'nd and an increase of 7 points from 24 hours ago. It's also nearly double the moving average for the index from about a week ago (see pic below)! One day ago when the index score of 40 was posted the price was $42,917 USD/BTC and tonight when the new index of 47 just posted the price was $43,896 USD/BTC.. The index did not move overnight and remained at a designation of "neutral."
Below is a 30-day chart of the Fear and Greed Index values. On left side of the horizontal x-axis is the date back to 30 days prior and on the right side is the current date. On the y-axis are the Fear and Greed Index values for those dates. The only values that exceeded todays index in the last 30 days occurred on March 1st, and on March 2nd.
Why Measure Fear and Greed?
Crypto market behavior is very emotional. People can get greedy when markets rise inducing FOMO (Fear of missing out). In contrast, people often sell their coins and fail to HODL during dips. With the Fear and Greed Index, the idea is to help save you from your own emotional overreactions. There are two simple assumptions:
- Extreme fear and the lowest index values can be a sign that investors are too worried. That could be a buying opportunity.
- When Investors are getting too greedy, and the index is at its highest on longer term, or shorter term scales, that means the market is due for a correction.
Sentiment and other factors are thus crunched into a simple metric from 0 to 100. Zero means "Extreme Fear", while 100 means "Extreme Greed". See below for further information on our data sources.
Data for the index is gathered from the five following sources. Each data point is valued the same as the day before in order to visualize a meaningful progress in sentiment change of the crypto market.
Volatility (25 %)
Current volatility and maximum drawdowns of bitcoin are quantified and compared with corresponding average values of the last 30 days and 90 days. The index creators argue that an unusual rise in volatility is a sign of a fearful market.
Market Momentum/Volume (25%)
Current volume and market momentum (again in comparison with the last 30/90 day average values) are quantified and combined together. Generally, high buying volumes in a positive market on a daily basis leads index creators to conclude that the market is acting overly greedy / too bullish.
Social Media (15%)
Reddit sentiment analyses are still not in the live index but the index does account for twitter-based analysis of sentiment. Index creators gather and count posts with various hashtags for each major coin (publicly, they show only those for Bitcoin) and check how fast and how many interactions they receive in certain time frames). A unusual high interaction rate results in a grown public interest in the coin and according to index creators corresponds to greedy market behaviour.
Surveys (15%) currently paused
The index creators have paused this feature for some and the percentage is split among the rest of the metrics.
The dominance of a coin resembles the market cap share of the whole crypto market. Especially for Bitcoin, the creators of the index think that a rise in Bitcoin dominance is caused by a fear of (and thus a reduction of) too speculative alt-coin investments, since Bitcoin is becoming more and more the safe haven of crypto. On the other side, when Bitcoin dominance shrinks, people are getting more greedy by investing in more risky alt-coins, dreaming of their chance in next big bull run. Anyhow, analyzing the dominance for a coin other than Bitcoin, you could argue the other way round, since more interest in an alt-coin may conclude a bullish/greedy behaviour for that specific coin.
The index creators pull Google Trends data for various Bitcoin related search queries and crunch those numbers, especially with respect to changes in search volumes as well as recommended other currently popular searches. For example, if you check Google Trends for "Bitcoin", you can’t get much information from the search volume. But currently, you can see related search queries, and some of the metrics about them. Depending on the search terms that come up, they could indicate more Greed, or more Fear in the markets. Google trends is a handy tool by the way.
It's great to see Bitcoin pumping and that once again we are all proven to be geniuses! HAHA! =) Let's hope it keeps heading that way a while.
One last unrelated, but important thing. If you don't know about Presearch, read on. Are you using Presearch yet to get free $PRE crypto and better and more private internet search results? Presearch is an internet search engine that'll work on your phone as an app, and desktop computers within web-browsers. When you use Presearch as you would Google for a web search, you get paid a reward in $PRE tokens. Currently, $PRE trades at about $0.20-$0.30 cents ($USD) per token ($PRE Coinmarketcap here), and there are probably more than 1.5 million active users. You can earn from about 1.5 to 3.0 $PRE tokens every day for doing around 30 web searches. The searches can be done back to back, and the reward fluctuates around the price of the token, going down when the token price goes up. Thus, you can even time your daily searches around when the token price swings downward to maximize the rewards. Even just searching "BTC price" using the app counts! Presearch is decentralized, traded on KuCoin and other similar platforms, and the leaders are vetted, and very vocal via their Twitter. Presearch is growing, but I think we are still kind of early - woot-woot! Watch for the token to blow up if they make it to Coinbase - get earning now. Sign-up only requires an email, super simple, and they are doing really cool stuff with NFTs and token-staking. In my opinion, leaders in their field. Anyway, please use my referral link to sign up - you'll get $PRE. At this point, Google - meh. I suggest you give Presearch a try and I got a feeling you'll like the search engine results regardless of the rewards - I DEFINITELY have. Did I also mention it can double as an app for your phone, is available in major app stores like Google Play, works great on my Samsung phones and Android systems, works amazingly in combination with Brave Browser on desktop computers (FEEL THE REWARD POWER), and I think works great on I-phones and Apple platforms. Don't Google that Bitcoin price, or Google that hot new shitcoin (LOL), instead Presearch it. Thank me later on this one.
Thanks for stopping by and I hope this post find you in good spirits.