Bitcoin Fear and Greed Index Clicks 94: Is Bitcoin due for Correction?

Tuesday 23 February 2021, 2:00 PM AEST - 1 week ago

So, since the past week, the largest digital currency, Bitcoin (BTC), made an impressive record in price, topping its previous all-time highs by over US$58,000. Notably, a massive amount of capital began flowing into the cryptocurrency following Tesla’s Bitcoin announcement. At the moment, however, BTC is shading points, and the fear and greed index suggests that the market may be due for a correction. 

Bitcoin F&G Clicked 94

During press time, Bitcoin was trading at US$52,223 on Coinmarketcap, which represented about an eight percent decline on a 24-hour count. Just before today, the market capitalization of the cryptocurrency was above US$1 trillion. However, the market cap sits at US$972 billion following the drop in the crypto’s market value. Bitcoin has shaded more than US$2,000 since Monday, and many people think the market is set for a correction. 

Such sentiments align with the Bitcoin fear and greed index from Alternative.me. The Bitcoin market is currently in an extremely greed state, as the index clicked 94 during the time of writing. Whenever the investors or markets get too greedy with an asset, the index suggests there could be an imminent correction. This somewhat backs the current retracement with leading cryptocurrency.

Is Bitcoin set for Correction?

As of February 21, the index scored the BTC market at 91, which is a less greedy state compared to the 94 on Monday. Overall, the Bitcoin market is just in a greedy state, as the index score last week and the last month indicated that investors have been greedy. So, we might be seeing a major correction in Bitcoin, although it remains unknown if the time is now. 

The CIO at Altana Digital Currency Fund, Alistair Milne, tweeted that we might see a correction of at least $48,000. He doesn’t think BTC will drop below that level.

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