What drove the crypto Fear and Greed index above 70?

The Fear and Greed Index is a metric that indicates the ongoing market sentiment on a scale of 0 to 100. As the name suggests, it measures the fear or greed of the investors.

For crypto investors, the metric considers social media sentiment and market volatility. While the metric is used prominently, it is considered a contrarian indicator. Thus, traders should use it in conjunction with additional analysis tools.

The Fear and Greed Index for the crypto market has recently been over 70. It is the first time the number has crossed 70 since November 2021. Although the number still indicates “greed,” it is getting closer to “extreme greed.”

But what pushed the index towards such a high extent? Let’s figure it out.

Understanding the Fear and Greed Index 

Before delving deep into the topic, it is crucial to understand the Fear and Greed Index.

The metric calculates trading volume, industry momentum, market surveys, technical indicators, and online sentiment. A low score (0 to 25) indicates extreme fear, while a moderate score (26 to 50) indicates fear.

Going up a score between 51 to 75 means greed, while 76 to 100 indicates extreme greed. A low score on the index means traders are not willing to buy crypto. On the other hand, a score above 65 shows decent confidence.

Under the current market sentiment, the crypto market crossing 70 on the Fear and Greed Index is intriguing news. The score shows how confident traders are currently in investing in cryptos. 

Recent Market Conditions

Bitcoin, the king of cryptocurrencies, gained 28% in the past two weeks, making it a highly sought-after asset for many traders, which led to a price rally in the entire market. The BTC crypto has finally crossed the $37k mark and is trading at $37,946 while writing.

BTC managed to touch its 17-month high recently to break the F&G curse after November 2021. The biggest factor that pushed BTC’s price is the spot ETF speculations.

The current crypto rally started with the whispers of BlackRock getting its BTC ETF approved by the SEC. The rumors helped BTC gain 7% in minutes, pushing its price to $30,000, which led to the entire crypto market going up. While the rumors were promptly found to be false, the motion showcased the potential Bitcoin boasts even in adverse market conditions.

Bullish Sentiment Factors

Besides the possibility of a Bitcoin ETF getting approved, the crypto market has witnessed massive developments. 

For instance, Ripple managed to land a partial win against the SEC in its long-fought legal battle. The DOGE community finally decided on a date to send a physical DOGE token to the moon. Disney decided to use NFTs to expand its market reach.

Shiba Inu’s Shibarium set new heights for blockchain networks. With Bitcoin ready to conduct its halving in the upcoming months, the bullish sentiments for the crypto industry keep increasing.

Expert Opinions and Analysis

Bitcoin has only been on the rise for the past couple of months. August was the month that solidified BTC’s position in the market. Crypto outperformed gold and tech stocks in terms of market volatility.

The asset hit $26,962 in September and a 28% rise in October to $34,650.  In November, the crypto reached $37,354 and is rising. Based on our Bitcoin prediction, the token may cross the $100,000 mark in the next 2 years, and by 2030, the crypto is expected to cross $313,600.

Wallet Investor expects BTC to maintain an average of $39,194 before 2023 ends. While Price Prediction also has a similar assessment, putting BTC at $35,461 for 2023. As for Gov Capital, their assessment puts BTC at $60,722 in a year.

Conclusion

For the past few months, Bitcoin has shown how to steer the market single-handedly. Ever since the rumors surrounding BTC ETF started surfacing, Bitcoin has been on the rise.

With that, the rest of the market has followed Bitcoin’s lead. Besides this, the F&G Index for Bitcoin has crossed 70 after 2 years. Given the current F&G index, more traders must buy into BTC as the metric indicates how confident traders are about the crypto’s performance. 

The speculations regarding Bitcoin ETFs keep increasing while the crypto is nearing its fourth halving. Under the circumstances, the market expects BTC to close in on its all-time high shortly.