Crypto Fear & Greed Index

Why Measure Fear and Greed?
The crypto market behaviour is very emotional. People tend to get greedy when the market is rising which results in FOMO (Fear of missing out). Also, people often sell their coins in irrational reaction of seeing red numbers. With our Fear and Greed Index, we try to save you from your own emotional overreations. There are two simple assumptions:
Extreme fear can be a sign that investors are too worried. That could be a buying opportunity.
When Investors are getting too greedy, that means the market is due for a correction.
Therefore, we analyze the current sentiment of the Bitcoin market and crunch the numbers into a simple meter from 0 to 100. Zero means "Extreme Fear", while 100 means "Extreme Greed".
Measuring fear and greed in the crypto market, as done through the Fear and Greed Index, serves several purposes:

1. Market Sentiment Analysis: The Fear and Greed Index provides a snapshot of the current sentiment in the market. Understanding the prevailing mood among investors can be valuable for traders and investors in making informed decisions.
2. Contrarian Indicators: The index operates on the principle of contrarian indicators. Extreme fear in the market might indicate that investors are overly pessimistic, potentially creating buying opportunities. On the other hand, extreme greed may suggest over-optimism and the possibility of a market correction.
3. Risk Management: Emotional reactions such as fear and greed can lead to impulsive decisions, including panic selling during market downturns or FOMO-driven buying during rapid price increases. The Fear and Greed Index can serve as a tool for risk management, encouraging investors to be cautious when the market sentiment reaches extremes.
4. Behavioral Economics: The field of behavioral economics recognizes that investor behavior is not always rational. Emotional factors play a significant role in decision-making. Monitoring fear and greed helps incorporate these psychological aspects into market analysis.
5. Educational Tool: The Fear and Greed Index can also serve as an educational tool for investors, helping them understand the psychological dynamics of the market. It encourages a more thoughtful and measured approach to decision-making, rather than succumbing to impulsive actions driven by emotions.
6. Macro Market Analysis: By aggregating and analyzing the sentiment of a large number of market participants, the index provides a macro-level perspective on the overall emotional state of the market. This information can be valuable for assessing broader market trends.