The Bitcoin Fear and Greed Index shows the level of greed after about 10 months.
The asset’s recent rise is undoubtedly the biggest factor in the metric’s change.
This metric, showing the crypto community’s sentiment towards Bitcoin, is in the “greed” zone for the first time since March 30, 2022.
Bitcoin entered the new year fast
Despite the economic crisis that swept the whole world, Bitcoin has made a rapid entry into the year. The asset sits in the $23,000 region, up nearly 40% compared to the last day of 2022, according to data from CoinGecko.
The Bitcoin Fear and Greed Index has been in the “fear” or “extreme fear” zone for quite some time due to factors such as the bear market and the collapse of FTX.
However, the spike in BTC value seems to have changed this trend. As of January 27, the metric currently marks greed at 55. In the last period when the index reached this level, the dates were showing March 2022.
Crypto investors’ confidence in the industry serves as an important catalyst for a potential bull rally.
Will the Bitcoin rally continue?
Bitcoin’s rapid entry into 2023 has caused investors to raise their hopes for a new bull season to come. In particular, the crisis created by inflation may result in an increase in the value of the asset in the coming months.
The US’s announcement of the Consumer Price Index paved the way for the volatility of Bitcoin to increase. Recent increases in inflation have caused the value of the asset to decrease.
Another important factor that can affect Bitcoin’s performance is the Fed’s policy of raising interest rates again. The regulator increased interest rates 7 times in a row, which paved the way for the asset’s value to decline.
At the time of writing, Bitcoin is trading at $ 23,003, according to data from the Binance exchange.