Important facts:
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The neutral sentiment reflects the market’s uncertainty as to which direction the price will head.
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This is happening while BTC price remains sideways.
The Bitcoin (BTC) market showed a shift in sentiment today, according to the Fear and Greed Index. He went from greed to neutrality.
After spending most of the past four weeks in a state of greed, the market is looking different today. Right now your feeling is in a neutral stateas was the case for a short time two days ago.
This has been pointed out indexwhich marked the 50 level two days ago and although it later rose to 56 it has now fallen back to 50. This shows that the optimism that has dominated the bitcoin market for the past month has gone for the time being with readings ranging from 55 to 65.
According to this index is The bitcoin market is in a state of neutrality when it is between 45 and 55. Instead, he points out that greed predominates when above 55 and at extreme levels when between 75 and 100. And he claims that when it’s below 45, the fear predominates and in an extreme state when it goes from 25 to 0.
According to this metric, extreme fear could be a sign that the market is too worried about selling its currencies, which is dragging the price down and could present a buying opportunity. And he reckons there could be a price correction if investors get too greedy.
On the other hand, if the market remains in a neutral state, it means that there is uncertainty among investors as to which direction the price will go. That is, they take neither a bullish nor a bearish position. Therefore, in such a scenario The price tends to be stable.
The bitcoin market is neutral and the price is trending
The price goes up when demand is greater than supply and goes down when the opposite is the case. However, the price is currently settling around around $30,000 for a week, suggesting that buyers and sellers are at a balanced level in this zone.
Given the neutral sentiment currently prevailing in the bitcoin market, the current price action makes sense., as measured by the Fear and Greed Index. In contrast, when greed reigned supreme among investors last month, the coin hit its highest level of the year at nearly $32,000.
To determine Bitcoin market sentiment, the Fear and Greed Index measures price volatility, momentum/trading volume, social media, dominance over other cryptocurrencies, and Google trends.
It should be noted that this is not the only market sentiment index. There are also others that are measured by other parameters, such as that of the CoinMarketCap explorer.
As reported by CriptoNoticias, CoinMarketCap’s Fear and Greed Index Already last week it became clear that the sentiment on the Bitcoin market was neutralHe. and is currently running find out in this state with a score of 55.
Unlike the other index, CoinMarketCap expects the market to become greedy when it crosses 60. And this is defined by a set of analysis parameters that are not disclosed.
With this in mind, it is important to remember that no market sentiment index should be considered exact. It serves purely as an indicator of investor sentiment and is measured by a number of variable parameters between each value.