Crypto Investor Sentiment Returns To Bitcoin All Time High Levels
The Crypto Fear and Greed index is now at levels we have not seen since November 2021 with the index now returning to the “greed” level:
Since 2023 began, crypto investor sentiment has been on a slow but steady uptrend. It finished the year 2022 in the ‘Extreme Fear’ territory which saw prices drop to new cycle lows. However, the change so far has been encouraging as the index has now returned to the ‘Greed’ level.
On Tuesday, the Fear & Greed Index hit a new 2023 high of 68, which brought it closer to ‘Extreme Greed’ than it has ever been. Now, this sentiment analysis is important because it helps to tell how investors are feeling toward the market.
When the index is in fear which is a score between 0-47, it shows that investors are very wary of the market, hence new money isn’t flowing into the market. But when the index is in greed, from 53-100, it means investors are very greedy and are more likely to invest.
This means that the index hitting 68 signals that crypto investors are looking favorably toward the market. Since investors are more likely to take risks when they are feeling more optimistic, it can usually translate to higher prices as the market sees more liquidity.