The Greed and Fear Index measures investor sentiment, with above 90% readings signaling greed or excess optimism and below 10% figures representing extreme fear or pessimism, said Markus Thielen, head of research and strategy at Matrixport. The index appears to have bottomed out as the daily signal (grey) is projecting upside pressure.
Matrixport’s proprietary Bitcoin Greed and Fear Index, which has a solid track record of marking trend reversals, is signaling a bull revival in Bitcoin (BTC). The index recently turned higher from 30% to 60%, bottoming out of July’s slide from above 90%. This indicator is tactically bullish and Bitcoin prices could resume the uptrend.
The 21-day simple moving average (SMA) of the index has historically coincided with bullish and bearish reversals in Bitcoin’s price. The 21-day SMA now shows signs of bottoming out, supporting the case for a renewed upside volatility in Bitcoin.
Bitcoin has been listless for some time now, trading between $28,000 and $30,000 for over two weeks, amid volatility in traditional markets and expectations for Fed rate cuts early next year. The SEC’s impending decision on spot exchange-traded fund (ETF) filings is a crucial catalyst for price volatility. The regulator is facing a deadline on Aug. 13 to approve or reject Ark Invest’s spot Bitcoin ETF application.