The unique Bitcoin Greed and Fear Index, developed by Matrixport, a well-known supplier of cryptocurrency services, is renowned for its precision in identifying trend reversals. This indicator now suggests that the positive mood for bitcoin (BTC) may be about to resume.
The Bitcoin Greed and Fear Index measures investor mood by classifying scores over 90% as excessive optimism or greed and readings below 10% as very pessimistic or fear. Market analysts pay great attention to these indicators because they often show market peaks during euphoric times and market troughs during anxious times.
Recent information from the Matrixport index shows a change from 30% to 60%, reversing the decline from over 90% in July. This increase portends a significant shift in mood. The index looks to have passed its lowest point, according to Markus Thielen, Head of Research and Strategy at Matrixport, and the daily signal anticipates future upward pressure. The indicator is displaying tactical bullishness, suggesting that the climb in bitcoin prices may resume after a four-week consolidation phase.
Historical research reveals a connection between index highs and lows and the index’s 21-day simple moving average (SMA) and the price of bitcoin’s ensuing bullish and bearish reversals. The 21-day SMA now shows symptoms of bottoming out, adding credence to the claim that bitcoin volatility is about to increase.
With prices ranging between $28,000 and $30,000 for more than a week, Bitcoin’s recent performance has been characterized by a lack of notable change. This period of stagnation has developed amid market turmoil on the conventional front and in expectation of probable Federal Reserve interest rate reductions in the first few months of the next year.
A key driver of probable price volatility, according to a number of experts, is the U.S. Securities and Exchange Commission’s (SEC) upcoming decision on applications for spot exchange-traded funds (ETFs). The SEC has until August 13 to decide whether or not to accept Ark Invest’s request for a spot Bitcoin ETF. Despite the fact that the deadline occurs on a Sunday, there is talk that the SEC may make its decision on the Friday before.
