 | FOMO and Greed is slowly creeping up again. Can you feel it? Some Data I've been looking at suggests this is just the beginning. Let's put this sentiment into context by looking at different Market Risk Indicators. TL;DR, we've got ways to go before we reach market risk similar to the last ATH. Fear and Greed Index (link) We all know the Fear and Greed index, so no need to explain what it is. In November of 2020 we were close to touching the old 20k ATH, sitting at about 18k USD. The Fear and Greed Index indicated a market risk of 88. Today, approaching the old 69k (nice) ATH at currently 61k, the F&G indicates 82 risk. Back then Bitcoin more than tripled in value and the F&G Index stayed in extreme greed territory for almost a whole year. Go figure. Alphasquared (link) Similar story here. This is an indicator I've been using for the past year to stack during the bottom and it's been unbelievably accurate. I'll use this mainly to DCA out starting at 80 risk. In November of 2020, risk sat at 56 before breaking the ATH of 20k. Today, we're at 56 Risk too, close to breaking the ATH of 69k. Rainbow Chart (link) The Rainbow chart overlays a log-trend to the price of Bitcoin. Same date for the dot in the image. We were close to reach the HODL range (middle, yellow line) at 18k. Now, we're very close to reaching the very same band with ways to go before we reach any of the red bands we got to the last cycle. Pi Cycle Top (link) The Pi Cycle Top Indicator looks arbitrary to me and I wouldn't put too much weight onto it, but it shows momentum of the market by looking at the 111DMA and 350DMA. The closer they are, the closer we might be to a top. This is the most arbitrary indicator in this bunch, but I wanted to include it. Same story, the current risk is very close to what is was in 2020 at 18k and we have ways to go before they intersect. Verdict Looking at these different indicators is telling. We could be entering new ATHs within the next few months and there's plenty in store. The recent movement feels like a lot, but putting it into the context of data analysis, there's way more to go. [link] [comments] |
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