The Crypto Fear and Greed Index has reached its highest level since July, consistently maintaining a score above 60 for two consecutive days. On September 28, the index recorded a score of 64, categorizing it in the 'Greed' zone as Bitcoin's price briefly touched $66,000, according to data from CoinMarketCap. Designed to numerically quantify the prevailing emotions and sentiments toward Bitcoin and the broader cryptocurrency market, the Crypto Fear and Greed Index operates within a range of 0 to 100.
The recent score of 64 is the highest observed since July 30, when Bitcoin was similarly valued around $66,000. This is a stark contrast to August, which was characterized by an average rating of 'Fear,' as the index struggled to surpass 60 and hit a concerning low of 17 on August 6, when Bitcoin was trading near $53,000. Various signals influencing traders' and investors' behaviors are used to compute the index.
These include Google Trends, surveys, market momentum, market dominance, social media engagement, and overall market volatility. Data from the Crypto Fear and Greed Index indicates that the score is derived from several components: 25% market volatility, 25% market momentum, and 15% social media trends, along with other indicators reflecting market sentiment. Markus Thielen, head of research at 0x Research, expressed in a report on September 27 the possibility of a crypto rally in Q4.
He noted that Bitcoin’s resurgence above the $65,000 threshold could ignite a fear of missing out (FOMO) among investors. CoinMarketCap data reveals that Bitcoin has experienced an approximate gain of 11.18% over the past month, marking its most substantial increase since March. Predictions from Charles Edwards, founder and CEO of investment firm Capriole, suggest significant capital inflows into Bitcoin will occur as traders pivot away from gold and traditional stocks.
Edwards stated, 'The capital flows back into Bitcoin from gold and stocks over the next six months will be relentless,' during an analysis shared in a post on X on September 27. Asset management heavyweight VanEck has classified Bitcoin as the best-performing asset of the year, showcasing an astounding 124% increase over the last 12 months, clearly outperforming conventional assets.
However, the asset management firm cautioned that a recent slump in prices has left many investors feeling 'spooked.'.