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Bitcoin Fear And Greed Index Comes Out Of “Fear” For The First Time In Nine Months

The highly relevant Bitcoin Fear and Greed Index fell into neutral territory over the weekend, after several months of fear.

On January 15, the index reached a neutral level of 52, the highest since April 5. The move follows a 24% rise in BTC over the past seven days..

In June 2022, the market confidence index reached its lowest level in several years, at 9 points. Since then, it has ranged from 20 to 30 in the “Extreme Fear” category.. Furthermore, it recorded its longest streak of extreme fear in mid-2022, Cointelegraph reports.

The Fear and Greed Index uses “movements and sentiment from a variety of sources,” including current volatility, market momentum and volume, social media data, Google Trends, and more..

On the whole, data from these sources is used to create a direct number that summarizes the emotional state regarding bitcoin and cryptocurrency markets.

It consists of five categories ranging from extreme fear to extreme greed, but the latter has not been seen since October 2021.

At the time of writing this article, the index is back down to 45, which puts it back in the ‘Fear’ category, suggesting that confidence has not yet fully returned.

For his part, Bitcoin has seen its second streak Longest winning streak ever: It’s been on a 12-day winning streak this month. The asset has gained 28% since the beginning of this yearwiping out all the losses from the drop that followed the FTX crash in early November.

The massive momentum has created a huge move in technical indicators like the RSI (Relative Strength Index)which has reached its highest level in four years on the daily time frame.

High RSI figures may suggest that an asset is overbought and a correction is on the horizon..

Several analysts have labeled the recent move a bull trap, but a strong weekly close has led some to believe the momentum will continue..

Professional trader and charting guru Peter Brandt summed it up on January 16 in a Tweet:

“Any idiot can make wild guesses about the markets, so here is my prediction. In reality, no one has a clue what any market will do. BTC.”

At the time of writing, bitcoin was trading 2.2% higher on the day at $21.1652according to CoinGecko.

Clarification: The information and/or opinions expressed in this article do not necessarily represent the views or editorial line of Cointelegraph. The information presented here should not be taken as financial advice or investment recommendation. All investment and commercial movement involve risks and it is the responsibility of each person to do their due research before making an investment decision.

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