Last month, statistics showed that the Crypto Fear and Greed Index (CFGI) had a score of 25, indicating an ” extreme fear “. Thirty days later, with a 39% increase in the price of bitcoin against the U.S. dollar, the current CFGI score as of January 30, 2023 is 61, reflecting a “greed“.
Etoro market analyst attributes bitcoin’s rise to changing investor expectations
Records show that bitcoin experienced significant growth in value in the first month of 2023, rising 39 percent against the U.S. dollar. On January 29, 2023, BTC reached a 30-day high of $23,954 per unit, with prices ranging from that value to a low of $22,988 in the last 24 hours. This rise significantly increased the Crypto Fear and Greed Index (CFGI) hosted on alternative.me, moving it from the “extreme fear“to the zone”greed” during the month.
Last week, CFGI records showed a score of about 50, indicating “neutral“, according to alternative.me. Seven days later, the CFGI score rose to 61, which means “greed“. The website says that when crypto investors get too greedy, it signals that the market is due for a correction. The CFGI score has remained above the neutral 50 area since January 23, 2023, after spending a lot of time below 45 before January 14, 2023. Monday, bitcoin (BTC) prices experienced weakness against the U.S. dollar as traders took profits.
Etoro market analyst Simon Peters attributed the halt in crypto-currency price declines to a shift in investor expectations regarding inflation and Federal Reserve interest rate hikes. Peters also noted that financial institution Goldman Sachs “published a positive note on bitcoin” citing a recently released market performance scorecard that shows bitcoin outperforming all other major asset classes, including gold, real estate and emerging markets.
“Bitcoin has performed extremely well so far in 2023, rising nearly 43% since January 1 on the eToro platform. Since its low point last year – $15,523 – reached on Nov. 9, it has risen just over 50 percent“, writes Simon Peters. “With inflation and interest rate expectations now turning, most asset classes have halted the declines seen in 2022, as investors begin to think ‘what’s next’ for their portfolios beyond the 2022 rate hike crash“, added the Etoro market analyst.