Bitcoin Greed Index Jumps 36% as Prices Rebound

As Bitcoin and other digital assets recover, data indicates that the sentiment among cryptocurrency investors has shifted back to a state of greed. The “Fear & Greed Index” is an indicator created by Alternative that measures the net sentiment held by the average trader in the Bitcoin and wider cryptocurrency spaces. This index uses data from five factors to determine market sentiment: trading volume, volatility, market cap dominance, social media sentiment, and Google Trends. The metric represents the calculated mentality as a score lying between 0 and 100, with 0 corresponding to maximum fear and 100 to maximum greed.

The current value of the Bitcoin Fear & Greed Index is 65, indicating that traders are predominantly feeling greedy. This is a significant change from the previous day when the indicator was at 47, suggesting a neutral investor mentality. The shift in sentiment can be attributed to the recovery of Bitcoin prices, which have rebounded following the geopolitical tensions surrounding the Israel-Iran conflict and the subsequent ceasefire announcement. However, the ceasefire has since been violated, which could potentially affect tomorrow’s Fear & Greed Index. Despite this, Bitcoin has held its value surprisingly well, implying that the sentiment may remain stable.

Historically, Bitcoin and other digital assets have tended to move in the opposite direction of investor expectations. An overly greedy market often signals a potential top, while an extremely fearful market indicates a possible bottom. Currently, the level of greed in the market is not excessively high, but the notable jump in sentiment alongside the recovery run is worth monitoring. If the hype continues to increase in the coming days, another reversal could become more probable for Bitcoin and other cryptocurrencies.

In other news, US-based Bitcoin spot exchange-traded funds (ETFs) saw net inflows on June 23rd. Despite the geopolitical tensions, the US Bitcoin spot ETFs recorded net inflows of around 598 BTC. This modest inflow, coupled with the absence of major outflows, is seen as a notable signal of investor confidence. Bitcoin's price has also recovered beyond its pre-plunge level, currently trading at $106,000. This recovery suggests that investor sentiment remains optimistic despite the recent geopolitical uncertainties.