Crypto markets are cooling down: F&G index to 'neutral'

It can go that fast: yesterday the pointer of the Fear and Greed Index was still at "Greed" (greed), but today, according to this barometer, sentiment has already fallen back to "neutral." Within just one day, the index fell by 19 points, which is one of the largest declines in recent years.

The shift in investor sentiment began to emerge mid-week when prices in the crypto market predominantly collapsed. At one point, the price of Bitcoin even dropped below US$93,000, while it was still above US$100,000 on Tuesday.

The recent profit-taking in the crypto market, as well as in traditional financial markets, is currently affected by several factors. In particular, reduced predictions of short-term interest rate cuts by the U.S. Federal Reserve are creating uncertainty among investors.

The Crypto Fear Greed Index calculates crypto market sentiment based on several factors, including market volatility, trading volume and Bitcoin's dominance. In November 2022, the index peaked at 94 out of 100 points, in the wake of Donald Trump's election victory.