Data shows that despite the latest rise in Bitcoin price, market sentiment has still been fearful recently.
Bitcoin Fear and Greed Index Keeps Pointing to โFearโ
According to the latest weekly report of arcane researchthe BTC market is still fearful despite the recent upward move in the price of the coin.
The "fear and greed indexโ is an indicator that tells us about the general sentiment among investors in the Bitcoin market.
To represent sentiment, this metric uses a numerical scale from one to one hundred. Values โโabove fifty fall into "greed" territory, while those below the threshold indicate "fear."
Values โโtoward the extremes of the range (ie, above 75 or below 25) indicate a feeling of extreme greed or extreme fear.
An interesting thing about these extreme values โโis that the highs and lows tend to occur when the market is in these regions.
Because of this, some investors think that selling during extreme greed is best, while periods of extreme fear are ideal for buying.
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An investment technique that follows this idea is called "contrary trading". This famous quote from Warren Buffet sums up the philosophy: โbe fearful when others are greedy, and be greedy when others are fearfulโ.
Now, here is a chart showing the trend in the Bitcoin Greed and Fear Index over the past year:
Looks like the value of the indicator has been low recently | Source: Arcane Research's The Weekly Update - Week 11, 2022
As you can see from the chart above, the Bitcoin Greed and Fear Index has been hovering in fear territory for many months, and still continues to do so.
Currently, the indicator value is 26, which is just above the extreme fear threshold. Usually during bullish rallies, the index sees an upside, but this fearful sentiment is present despite the recent surge in the price of the coin above the $42k mark.
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One factor behind these fear values โโis the various macro uncertainties hanging over the market at the moment, one of which is the Russian invasion of Ukraine that is still happening.
BTC price
At the time of writing, bitcoin price floats around $42k, up 4% in the last seven days. Over the last month, the crypto has gained 10% in value.
The chart below shows the trend in the price of the coin over the last five days.
BTC's price seems to have enjoyed some uptrend in the past couple of days | Source: BTCUSD on TradingView
Featured image from Unsplash.com, charts from TradingView.com, Arcane Research
