Bitcoin Market Sentiment Drops to Low Level

Just days after the historic approval of spot Bitcoin, the Crypto Fear & Greed Index has dropped back to "neutral" levels last seen in October 2023.
In the United States, BTC tickers are down $42,658 exchange-traded funds (ETFs).
Bitcoin's market sentiment score is currently 52 out of 100, the lowest since Oct. 19, 2023, when it traded for an average daily price of around $31,000.
The change comes less than a week after the Crypto Fear & Greed Index briefly reached a "extreme greed" score of 76 as the market awaited the approval of spot Bitcoin ETFs.
To score market sentiment each day, the index collects and weights data from six market key performance indicators: volatility (25%), market momentum and volume (25%), social media (15%), surveys (15%), Bitcoin's dominance (10%), and trends (10%).
While Bitcoin reached as high as $49,000 in the 24 hours following the SEC's decision to approve spot Bitcoin ETFs, it fell as low as $41,500 by Jan. 12 as traders locked in profits.
According to Trading View data, bitcoin has since leveled off slightly and is now trading for around $42,200 at the time of publication.
Related: Bitcoin price drops following ETF approval — Have investors turned bearish?
Meanwhile, there has been uncertainty surrounding spot Bitcoin ETFs since their launch, with conflicting data about their performance and a lack of information about the new investment vehicles' more granular details.
According to Google Trends, searches for "Why is Bitcoin dropping?" have increased 1,100% as market participants seek to understand the significance of recent Bitcoin price movements.