Data shows the Bitcoin Fear & Greed Index has slipped back into the fear territory following the crash in the cryptocurrency’s price.
The index uses the data of the following five factors to determine the investor mentality: volatility, trading volume, market cap dominance, social media sentiment, and Google Trends.
It then represents the calculated sentiment as a score lying between zero and hundred. All values above 53 correspond to a net sentiment of greed, while those under 47 imply the presence of fear in the market. A value between these two thresholds naturally corresponds to a neutral mentality.
Now, here is how the sentiment among Bitcoin traders is currently like, according to the Fear & Greed Index:
As is visible above, the index has a value of 45 at the moment, indicating that the investors are fearful, although only to a slight degree. The fear value is a new shift for the market, with this being the first time since September 7th that the metric has dipped into the zone.
The worsening of sentiment is a result of the bearish price action that Bitcoin and other digital assets have faced recently, with prices across the sector observing a particularly sharp drop during the last 24 hours.
On the Fear & Greed Index, there are two regions where this likelihood becomes the strongest: extreme fear (below 25) and extreme greed (above 75). The former is where major bottoms have occurred in the past, while the latter has facilitated top formations.
While the investor sentiment is currently far from turning into extreme fear, the fact that investors are no longer greedy could still be a positive for the bull run’s hopes. It only remains to be seen, though, how things would play out for Bitcoin and other cryptocurrencies.
Bitcoin has come down to the $12,600 level following its latest plummet.
