The Bitcoin market’s Fear and Greed sentiment indicator has recently reached its highest level of greed since November 2021, indicating a potential cause for caution when purchasing BTC.
Typically, analysts suggest buying Bitcoin when the index is below 25, but with the current index at 68, it may not be the best time to invest.
The Fear and Greed index is created using a combination of data, including Bitcoin’s volatility and social media trends, and it is divided into five categories, from extreme fear to extreme greed. In January, the index stood at 55, indicating a less extreme sentiment.
Recently, the cryptocurrency market has experienced rapidly changing sentiments. Just a week ago, many believed that the cryptocurrency market was entering a “cryptowinter.”
However, the trend has reversed, and Bitcoin has been growing in value amidst a series of large bank collapses. Between March 10-17, Bitcoin’s value increased by over 28%, rising from $20,220 to $26,038, and it is currently trading at around $28,000.
Additionally, the latest recalculation of the mining difficulty of the first cryptocurrency has set a new record of 43.55 trillion hashes, increasing mining difficulty and making it less profitable.