Cryptocurrency markets have taken on a positive mood with the entry of 2023. While the rise is supported by some technical indicators, there is a remarkable rise in the “Crypto Fear and Greed Index”, which measures the market perception. Bitcoin price maintained its bullish outlook by testing the $21,400 band once again, and the losses were offset by reaching the price zone before the FTX crash.
On the other hand, “Crypto Fear and Greed Index” recorded a rising trend this week, indicating that it was out of the fear zone. The index, which moved to the neutral zone by rising to 52 levels at the weekend, fell slightly, but rose above the 50 level again today and is now in the neutral zone again. This move is interpreted as an important move since it is the first time since April 2022.
Before entering April last year, cryptocurrencies in a downtrend had an average increase of more than 20% in a 2-week period with a recovery momentum. However, the predominance of macroeconomic effects at that time and the emergence of problems in the crypto markets caused the recovery process to be limited and the decline to continue. The index, which reflects the current bullish sentiment, currently reflects the optimism in the market with a similar outlook to April. The index, which was at 53 in April, quickly pulled back as pessimism in the crypto market began to increase as negative news spread. While the sharp declines experienced until June were supported by the Fed’s hard interest policy and the collapse of Terra, the fact that crypto miners had to sell their assets pushed most cryptocurrencies, especially Bitcoin, to the bottom of the year. Meanwhile, the fear and risk appetite index decreased to 6 levels, reflecting the extreme fear conditions.