There is always one type of indicator we see in the crypto market that tracks market sentiment. This is a crypto indicator which is basically known as trader or fear and greed indicator. It is an indicator that tracks this index in its calculation, but it has been a good indicator to track market sentiment and evolution. We look at this indicator in the crypto market to understand what kind of emotions are working among the investors and can understand a lot about the sentimentality in the market.
> Screenshot taken from Binance
For example, if we look at such an index in the market today, it can be seen that it is actually close to 24 out of 100 at present. This is on the lower end of the range. It means feeling of extreme fear. However, we haven't been in this position for a long time and it has come down to the 10 out of 100 level in the past few days which has caused extreme fear in the market and is probably the lowest level in the last few years. We haven't been at this level for a long time. Market sentiment usually does not stay in the upper or lower range for long. But we have been stuck at this same level for a long time. For example, if you look at the fear and greed index, it has been in this state for the past few weeks. When it touches one of these points it usually changes direction or moves to a more moderate level.
But although we have been in this position for some time now, we hope to change from this position very soon. This does not mean that the price will be higher as this indicator will move into a more moderate range. Like last few months it was at a neutral level and also at very greedy level at times. But Bitcoin's dominance for a long time and some bad news and now Trump's tactics have combined to create a panic in the market. As a result, an extreme level of fear is currently felt in the market. It can go higher, but it's not 100% correlated.
But one thing interesting is that when bitcoin price was above $100,000 we were more greedy but now bitcoin price has dropped to around $76 thousand now we are feeling the most fear. We tried to hold assets when Bitcoin was high but are afraid to hold the same exact assets now. It is very difficult to go against our own nature, we are human and we are governed by emotions. Fear and greed can shape your destiny, don't let these emotions dictate your future, you are better than this. But we could see lower levels if the market sentiment does not change quickly in the index we are currently seeing. However, if we can't control our emotions then we cannot get out of this stage.
