Crypto traders use the Crypto Fear and Greed Index to measure market sentiment on a scale from 0 to 100. This is an index that aims to measure whether the market during a particular period has been driven by fear or greed, with scores close to 0 hinting at extreme fear and 100 points representing extreme greed.
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The index analyzes data — volatility, market momentum, as well as social media trends for additional insights into how the crypto community is feeling. For investors wanting to master this boiling and churning market, knowing such ups and downs is crucial—a movement of 20 to 80 can put you either in the money or the meat grinder.
What is Crypto Fear and Greed Index?
The Crypto Fear and Greed Index is an instrument used to determine the general sentiment in the crypto market. The data from different sources are incorporated into a single number between 0 and 100, where 0–24 means extreme fear, 25 to 49 indicates fear, 50 neutral, 51–74 greed, and values of 75 indicate extreme greed (extreme greed). This index is mainly centered around Bitcoin and it leverages a lot of the sentiment surrounding the rest of the crypto market.
As the behavior of buyers and sellers is emotive, anything can cause the market to dive within minutes with a single piece of headline news or alternatively achieve vastly new heights. This results, respectively, in either “fear” or “greed” taking root in the market.
One of these is the FOMO or fear of missing out, which occurs when major companies express their interest in Bitcoin. This is often enough to set off the retail investors who push the market higher. Such a sentiment-driven move can create big profits or losses when many participants act in the same way. Traders can use this pattern to guide their decisions when the index changes between 20 (fear) and 80 (greed).
Key Facts of Crypto Fear & Greed Index:
- Tracks current crypto market mood (fear or greed).
- Analyzes factors like momentum, volatility, and social media.
- Helps traders to make smarter decisions.
- Analyzing the market, which is driven by (Fear or Greed).
- The index is updated daily, weekly, monthly, and yearly to show changing trends over time.
How the Fear and Greed Index Works in Crypto Markets?
In addition, the Fear and Greed Index assigns a number between 0 to 100, where extreme fear represents a score of 0 and extreme greed scores 100 A low score (extreme fear) means investors are panicking and selling, and is therefore a buying opportunity. Conversely, a high score (extreme greed) means that investors are hungry to purchase but the market could be over price or ready for a decline.
The basic rule is easy: when the market is up, it overcomes greed and more people buy (price goes up). Fear is the driving force that causes panic selling, thus leading to a price drop whenever the market crashes.
Key points to understand:
- A low score suggests fear, which could be a good time to buy.
- A high score shows confidence, but it may also mean the market is overheated or due for a correction.
The index is based on factors like market volatility, trading volume, Bitcoin dominance, social media trends, and search data. It shows how emotions drive price movements in the crypto market.
For example:
- Extreme Fear: After the FTX fallout in November 2022, Bitcoin’s Fear and Greed Index hit 12, signaling extreme caution.
- Extreme Greed: In March 2024, Bitcoin reached an index score of 90 due to anticipation of Bitcoin halving, with prices hitting new highs.
The index helps track market sentiment, showing how emotions shift with major events.
Index Score | Market Sentiment | Index Colour |
| 0 – 24 | Extreme fear | RED |
| 25 – 49 | Fear | YELLOW / Orange |
| 50 | Neutral | LIGHT YELLOW |
| 50 – 74 | Greed | LIGHT GREEN |
| 75 – 100 | Extreme greed | GREEN |
Crypto Fear & Index Chart Calculator
How To Use Crypto Fear and Greed Index? Or, How can I use the Crypto Fear and Greed Index in trading?
The crypto market can be very volatile because investors often react emotionally. When prices go up, people may feel FOMO (Fear of Missing Out) and get greedy. When prices drop, fear can take over, leading them to sell.
Traders use the Fear and Greed Index as a tool to understand market sentiment and make smarter decisions. It helps them see if the market is driven by fear or greed.
Here’s how you can use the index:
- Extreme Fear: This may be a good time to buy, as people are overly worried.
- Extreme Greed: This could mean the market is overvalued and due for a correction.
How Is the Crypto Fear & Greed Index Calculated?
The original Fear & Greed Index by CNN Money was created for stock markets, using factors like stock price momentum, trading volume, and demand for risky bonds. However, these factors don’t fully apply to cryptocurrency markets.
For crypto, the Fear & Greed Index (like the one by Alternative.me) uses different data sources, each weighted to give a final score:
- Volatility (25%): Measures how much the market is fluctuating compared to the last 30-90 days. More volatility means more fear.
- Market momentum/volume (25%): Looks at buying and selling volumes. Higher buying means more greed.
- Social media (15%): Tracks social media interest and sentiment around Bitcoin.
- Surveys (15%): Polls from users and investors about their outlook on the market.
- Dominance (10%): If Bitcoin’s dominance in the market increases, it usually signals fear.
- Trends (10%): Based on Google search trends for crypto-related terms.
- These factors combined give a snapshot of the current market sentiment.
Who Provides Crypto Fear and Greed Index Chart?
There are several crypto firms that provide the Fear & Greed Index chart to analyze the recent sentiment of the market. Some of the top providers are:
Alternative.me Index
BitDegree Index
Bitcoin Twitter Index
CNN’s Fear & Greed Index
Alpha Data Analytics
LookIntoBitcoin
CoinStats
We’ve used the Alternative.me Fear and Greed Index as an example, which is one of the first in the crypto market and updates automatically every 12 hours. However, there are other Fear and Greed indexes you can check out, which also give insights into the overall mood and dominance of the cryptocurrency market. Let’s take a look at some of these other indexes too.
Index Provider | Update Frequency Timeline |
| Alternative.me | Every 12 Hours |
| Bitcoin Twitter Index | Multiple Times In 12 Hours |
| CoinStats | Every 12 hours |
| CNN’s Fear & Greed Index | Everyday |
| BitDegree Index | Everyday |
| LookIntoBitcoin | Everyday |
| Alpha Data Analytics | Every Hour |
Does the Crypto Fear and Greed Index only apply to Bitcoin?
The Crypto Fear and Greed Index mainly tracks Bitcoin because Bitcoin is the largest and most influential cryptocurrency. Its movements often affect the entire crypto market. However, the index can also give insights into the broader market’s sentiment, as many altcoins tend to follow Bitcoin’s trends.
That said, the index isn’t perfect for measuring the sentiment of every cryptocurrency. Some altcoins might behave differently due to their own specific factors. So, while it’s a good general indicator, it’s best to use other tools if you’re focusing on a specific coin.
Is the Crypto Fear and Greed Index accurate for long-term investments?
The Crypto Fear and Greed Index is more for daily market emotions like fear or greed, which makes it better suited to short-term trading purposes. Such emotions lead to short-term price moves, making it easier for traders to know when the time is for them to enter or exit a position.
For long-term investments, the index is not so helpful as market sentiments fluctuate wildly and do not always reflect the actual worth of a coin. What long-term investors should care about is the underlying fundamentals of a cryptocurrency: its technology, level of adoption and potential for growth—not daily mood swings in the market.
How often is the Crypto Fear and Greed Index updated?
The Crypto Fear and Greed Index is updated daily. It uses real-time data from factors like market volatility, trading volume, and social media sentiment to give an up-to-date snapshot of how the market is feeling. This daily update makes it particularly useful for short-term traders who need to keep track of market sentiment frequently.
Is the Crypto Fear and Greed Index reliable?
Crypto Fear and Greed Index is a good tool, yet only a part of the picture, to be used as an indication for investment decisions. Market psychology and price momentum are often reflected in the short-term movements of prices; as such, this reflects market sentiment quite accurately due to the nature of fear and greed. But because the index is based on market volatility, social media trends, and Bitcoin dominance it occasionally reacts to short-term events that have little connection with the long-term prospect for cryptocurrencies.
This is a nice sentiment measure, but it does not reflect the fundamentals of the market and potentially external factors (regulation or technology breakthroughs) that would inherently influence prices in each of these cycles.
