Fear and Greed Index falls back to fear for 1st time since October

The sharp decline in Bitcoin price has led to a significant deterioration in sentiment among cryptocurrency traders.

The Crypto Fear and Greed Index, which reflects the overall emotional background of the crypto market, dropped to 43, the lowest level since last October.

Source: Alternative.me

The indicator has moved from the greed zone, where it was just a week ago, to the fear zone, indicating increased investor anxiety. Fear is indicated by a value from 26 to 46 on the scale. It is assumed that a downward trend prevails at these levels.

Continuing capital outflows from US spot ETFs are putting pressure on the market. On May 1, net outflow of funds from the spot Bitcoin ETF reached $564 million, the highest amount since the products launched in January.

However, Santiment analysts remain optimistic about the future of BTC price. Experts stated that the market correction was predictable given the increase in Bitcoin capitalization before the halving. After the halving at the end of April, investors were buying on rumors and selling on news.

According to analysts, growth in the Bitcoin market in October 2023 and early spring 2024 was driven by high expectations for the halving. However, those who purchased BTC at the end of March, when the price was at an all-time high, were left at a loss.