In the previous section, we discussed the feelings of short-term holders . Market sentiments are very important in a market as volatile as that of cryptocurrencies. For the craze to be present, and for new arrivals to be able to bring demand allowing BTC to rise , the price of the king of cryptocurrencies must reach new historic highs .
The Crypto Fear and Greed Index indicator allows you to understand the market sentiment of operators by analyzing metrics such as volatility, volume or even enthusiasm on social networks. However, after a short period of fear , the indicator is back in the zone of extreme euphoria (blue) :
Crypto Fear and Greed indicator chart. Source: Glassnode
During bull market phases , we notice that the correction periods are relatively short . Also, Crypto Fear and Greed tends to move between the neutral zone (yellow) and the zone of extreme euphoria . There are also sometimes returns to the fear zone (orange) , but this must remain extremely short to avoid returning to a downward trend as at the end of 2021. According to data from Glassnode, the market is still in bull market conditions , and a new period of extreme euphoria , greater than the previous one, could set in.