The Crypto Fear & Greed Index, which measures investor sentiment towards Bitcoin and cryptocurrency markets, returned to October levels with the decline in Bitcoin prices in the last days of 2024.
The index fell to 65 points with the December 30 update, recording its lowest level since October 15, although it is still in the “greed” zone.
Bitcoin is currently trading around $93,700, according to CoinGecko data, and is down 10.4 percent in the past 14 days, prompting warnings of a larger sell-off as investors turn to stablecoins.
The Crypto Fear & Greed Index had generally remained above 70 in November and December, as Donald Trump won the US presidential election and many pro-crypto politicians gained seats in Congress. The index peaked at 94 points on November 22.
Bitcoin price may fluctuate
The index is calculated based on signals that influence investor behavior, such as Google Trends, surveys, market momentum, market dominance, social media, and market volatility. Therefore, changes in market sentiment are closely correlated with movements in Bitcoin price.
Markus Thielen, analyst and head of research at 10x Research, said some analysts are expecting a “timed parabolic move” ahead of Trump’s inauguration, but are predicting a significant correction could follow. Thielen, however, took a different view, saying, “I expect volatility to increase soon.”
Stay tuned