The latest Bitcoin and crypto market crash has seen costs plunge into the purple throughout the board. In consequence, sentiment amongst crypto traders has plunged quickly and this has triggered the Worry & Greed Index to plunge into the Excessive Worry territory. This means that traders are much less prone to put cash into the market, nevertheless it may additionally include excellent news for the market.
Worry & Greed Index Sitting At Excessive Greed
The Bitcoin Worry & Greed Index is likely one of the finest indicators of telling how traders are feeling towards the market at any time. This index makes use of a scale of 1-100, representing sentiments ranging throughout Worry, Excessive Worry, Impartial, Greed, and Excessive Greed. Every of those can present how traders are feeling and might be a inform for the place the Bitcoin worth might be headed subsequent from right here.
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Normally, when the Worry & Greed Index is sitting on both excessive, it may imply that the worth is about to swing in the other way. So, for instance, the Bitcoin Worry & Greed Index is in Excessive Greed may recommend that the worth is about to fall, and vice versa.
This pattern can be constructive for the Bitcoin worth proper now because the Worry & Greed Index has fallen into the Excessive Greed territory. As of Friday, the Worry & Greed Index had fallen as little as 22, which put it firmly within the Excessive Worry territory.
Going by the Bitcoin worth having a bent to recuperate when the index is within the purple, it may imply that the worth is reaching a backside. An instance of that is when the Bitcoin Worry & Greed Index fell to twenty in August, earlier than the crypto market seeing a fast rebound. If that occurs right here, the Bitcoin worth might be on the verge of a restoration.
Bitcoin Rebound Not Seemingly In September
Whereas the Worry & Greed Index sitting within the Excessive Worry territory may level in direction of a backside, the rebound could not materialize for some time. It’s because the month of September has traditionally been very bearish and expectations are that this month won’t be completely different.
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Veteran analyst Benjamin Cowen outlined this in a put up on X (previously Twitter), revealing that this month is already on monitor with earlier September months. To date, the Bitcoin worth has already fallen 8.16%, and “If BTC closes the month at this worth, it might be a reasonably typical September,” the analyst explains.
The avg. return of #BTC in September is -6.3%
To date this month, BTC’s return is already -8.16%.
The one time within the final 5 years the place the Sep. month-to-month return was worse than this was 2019 (-13.91%)
If BTC closes the month at this worth, it might be a reasonably typical September pic.twitter.com/bZ9cRIl9OU
— Benjamin Cowen (@intocryptoverse) September 6, 2024
Nonetheless, the month of October is often bullish, so if this pattern continues, then September is prone to finish within the purple. However then when October rolls round, costs are anticipated to select again up.
Featured picture created with Dall.E, chart from Tradingview.com
