Fear & Greed index
The Fear & Greed index condenses several market signals into a single number between 0 and 100, where low readings indicate fear and high readings indicate greed.
Updated 18 min ago · Source: Alternative.me
What it measures
The index is a composite. Its published methodology weights market volatility most heavily, followed by market momentum and volume, then social media activity, then Bitcoin’s share of total market capitalisation, and a survey component that has not always been active. The reading is dominated by volatility and momentum — which means it is largely a description of recent price behaviour, expressed as an emotion.
How to read it, and how not to
It is a sentiment thermometer, not a signal. The common framing — buy when others are fearful — is a reasonable observation about crowd behaviour and a terrible mechanical trading rule. Readings of extreme fear have marked good entries and have also persisted for months while prices fell further. Extreme greed has preceded corrections and has also continued for long stretches of rising prices.
What the index is genuinely useful for is checking your own reaction against the market’s. If you are feeling calm while the index is at extreme greed, or panicked while it sits in neutral, that gap is worth examining before you act.
Its limitations
The index is Bitcoin-dominated: it reflects the largest asset far more than any individual altcoin, and a coin can be in its own severe drawdown while the index reads greed. It is backward-looking, computed from what has already happened. And because volatility is its heaviest input, a sharp move in either direction pushes the reading — meaning a violent rally and a violent crash do not affect it symmetrically in the way most readers assume.
The 30-day history beside the gauge is more informative than the current number on its own. A reading of 30 that has climbed from 12 describes a very different market from a reading of 30 that has fallen from 70.
Frequently asked
Who produces it? Alternative.me publishes the index and its methodology. We read it directly and show when we read it.
Does a low reading mean it is time to buy? No. It means recent price action has been fearful. What happens next is not contained in the number, and treating it as a trigger has lost people money in both directions.
Why does the gauge sometimes not appear? If we cannot retrieve a real reading, we render nothing rather than showing a stale or invented value.