Extreme greed on the market

[jaberwock]

Hey guys,
By recent Fear&Greed Index bitcoin is in extreme greed area, usually it's a sign of decline in price or even crash. I've been observing this index for quite some time and find it pretty accurate, of course it doesn't give you the exact day or time but it indicates the sentiment on the market. Do you ever use this index in your trading analysis?

Yep, I think I get what you’re trying to say here: when there is a huge growth like this, there will be a sign of greed in the market and people will be hoping for more increase, you will start so many of them buying and making analysis of more increase.

At times like this is when FOMO kicks in and before you know it, the market will crash and so many of them will lose their money out of greed. Same thing happens when the market starts falling, there will be fear, just like earlier when the price was down to $3k and people were predicting $1k and $2k or even less, but instead the price turned and started going up.

[Vispilio]

For this particular index, greed level of 86 is categorized as extreme but it's not extreme in the context of a statistical distribution.

Historically crypto markets have rallied for months and months while this index consistently remained above 90, so we can say values above 95 here would be more statistically significant to look for imminent reversals...

[coolcoinz]

Fear&greed index shows only a general market trend and it's not something you could use to know when to sell. For instance, there were instances where the index remained at extreme greed for weeks (2017 bull run). If you sold when it begun to show extreme greed you'd probably sell somewhere at 10k, when it later went to 20.

For this particular index, greed level of 86 is categorized as extreme but it's not extreme in the context of a statistical distribution.

Historically crypto markets have rallied for months and months while this index consistently remained above 90, so we can say values above 95 here would be more statistically significant to look for imminent reversals...

Yes, becaue with 50% increase in price over a short term, like 5 days, the indicator will naturally go to 80 and above, but that doesn't mean it's the end. It's the same with fear. We used to be in extreme fear 12-10 in March and April of this year.
Another interesting development is happening right now, on the day when we broke to a yearly high of 18700 greed went down from 94 to 86. So greed is dropping while we are pumping. I like it

[imstillthebest]

Yes, I have used the Greed Index, it is accurate if the market conditions are very extreme, usually this is because FOMO is too strong so the market is overbought, I never buy coins when the market is overbought, because I know that soon the market price will fall.

Remember what BTC USD Dec 2017? problem is, only because something is overbought, does not mean it can't continue to rise... I agree I would not buy in these circumstances, but I would not unnecessarily sell in these conditions either. I am waiting for structure and then act on it if I see it on the screen. Works well for me so far.

price supposed to rise if market is over bought because over bought means there was a huge demand but we all have a buying preference and you dont need to squeeze your self in to buy if you think the price is too high for you but for some they will buy because they can afford it and they know that the prize can still grow .

greed is normal and still be manageable . you can use it as advantage to stay holding and buying but extreme greed sound exagerated already . too much is bad

[Smartvirus]

I am one of those who rarely use the fear and greed index when trading, maybe I feel that I don't fit with the strategy I use.
I mostly use volume indicators and RSI in trading, the more reliable and accurate I think. But that doesn't mean the fear and
greed index is bad, but using the fear and greed index only makes me panic if there is a bullish market.

I don't know about these features and never used them

I'm seeing this just now and it's got me wondering if there exists such a feature on any trading platform because, I'm yet to see it or maybe don't know the feature yet. I naturally thought, the fear and greed thing is your natural emotions of a trade you placed and not some algorithmic possible calculation of some sort.
What would be the bases for this calculation because if I may enquire?
Like the RSI (Relative Strength Index) it uses the number of buyers to sellers in the market at a particular period to determine strength on one side but then, what would be the bases for fear and greed index as an indicator should it exist?

[Fredomago]

price supposed to rise if market is over bought because over bought means there was a huge demand but we all have a buying preference and you dont need to squeeze your self in to buy if you think the price is too high for you but for some they will buy because they can afford it and they know that the prize can still grow .

They are trusting that the trend will go further and even the value is already high there's still possibilties that it will bring more for their invetment, to those who are not here as fomo's they really did a good research and they are basing things to work out according to the
research that they'e conduct.

greed is normal and still be manageable . you can use it as advantage to stay holding and buying but extreme greed sound exagerated already . too much is bad

If you know and understand what you are doing, this really makes a good advantage to you, not fearing the sideways and still believing with thw power of holding, greed can be your friend while working around this venue of investment.

[milewilda]

I am one of those who rarely use the fear and greed index when trading, maybe I feel that I don't fit with the strategy I use.
I mostly use volume indicators and RSI in trading, the more reliable and accurate I think. But that doesn't mean the fear and
greed index is bad, but using the fear and greed index only makes me panic if there is a bullish market.

I don't know about these features and never used them

I'm seeing this just now and it's got me wondering if there exists such a feature on any trading platform because, I'm yet to see it or maybe don't know the feature yet. I naturally thought, the fear and greed thing is your natural emotions of a trade you placed and not some algorithmic possible calculation of some sort.
What would be the bases for this calculation because if I may enquire?
Like the RSI (Relative Strength Index) it uses the number of buyers to sellers in the market at a particular period to determine strength on one side but then, what would be the bases for fear and greed index as an indicator should it exist?

This had been a typical tool or indicator in forex on whats the current situation of the market: https://money.cnn.com/data/fear-and-greed/
For now im a bit already worried into this kind of movement where it is moving way up too fast imho.We are almost hitting 19k in no time
and maybe only in this month we will hit 20k if this cant be stopped.I have already sold my bags and im waiting now for the
correction to accumulate again but it seems it doesnt have any plan to go down.

[South Park]

If this was a good indicator people would only be using it to trade and always make money.

Fear and greed index is good as an addition but price can sit on extremes for weeks. When we were in bear market last year the index was showing fear/extreme fear for many weeks.
It is indicating a coming correction but that correction may come now or next week and in the meantime we could hit a new high.

People need to understand that indicators do exactly what it is in their name, they indicate something but they are not going to tell you exactly when something is going to happen, that is something that the trader needs to decide by themselves, we know that we are in a period of the market which is experiencing extreme greed and I do not see this changing during the next days because people have a lot of hope that we are going to reach a new ATH during that time, and if we do then there is no telling how high the price will go and most likely we will remain in the greed part of this index.

[Untomabur]

I've read about extreme Greed, that extrem greed will bring the price of an asset to experience a selling action,
this happened because of an observation, yes, this is my observation too, because this tendency makes people greedy.

[drlukacs]

For this particular index, greed level of 86 is categorized as extreme but it's not extreme in the context of a statistical distribution.

Historically crypto markets have rallied for months and months while this index consistently remained above 90, so we can say values above 95 here would be more statistically significant to look for imminent reversals...

But I think it's just a correction, not a reversal. In my opinion, politics as well as major countries in the world are very chaotic, that will reduce the value of Fiat money, then the demand for Bitcoin will be even more.
Maybe this year the Halving event will make the price of Bitcoin pump stronger than before, let's wait for the results.
 I predict Bitcoin's price this year will soon reach $ 26k.

[Lorokan]

Hey guys,
By recent Fear&Greed Index bitcoin is in extreme greed area, usually it's a sign of decline in price or even crash. I've been observing this index for quite some time and find it pretty accurate, of course it doesn't give you the exact day or time but it indicates the sentiment on the market. Do you ever use this index in your trading analysis?

One thing in crypto currency trading, and investment is that greed takes you no where at all. One of the most focal attitude you have to fix while joining crypto currency is your attitude and response to market pump / dump. Irrespective of the strategies you employ in trading; you cannot have maximum profits with GREED.

[Stedsm]

I do watch Fear&Greed Index and yeah, when there's too much good happening in the markets, you also need to be prepared for some "blood on the streets" kinda scenario soon. People have greed in their souls but are also afraid of losing a ton of money invested during this point of time when BTC is too high and when something hangs high, chances of an extremely huge drop are immense. My talks may sound like I'm bearish on BTC but I'm not, these are the facts which can't be overlooked. A correction or at least a retracement is incoming.

[Mahanton]

I do watch Fear&Greed Index and yeah, when there's too much good happening in the markets, you also need to be prepared for some "blood on the streets" kinda scenario soon. People have greed in their souls but are also afraid of losing a ton of money invested during this point of time when BTC is too high and when something hangs high, chances of an extremely huge drop are immense. My talks may sound like I'm bearish on BTC but I'm not, these are the facts which can't be overlooked. A correction or at least a retracement is incoming.

Counters and disagreeing into those words you have said do proves out on being a permabull.

Things like this is inevitable on where the market is hyping up that fast then we cant really remove the fact that we would definitely having the time of some price crash or correction.

This had been always part of the market where there's rise and there's fall down.They do differ in intensity or level but doesn't mean that we should neglect every on the smallest possibility

yet you can either benefit or would totally be on losses.

[TheGreatPython]

we know that we are in a period of the market which is experiencing extreme greed and I do not see this changing during the next days because people have a lot of hope that we are going to reach a new ATH during that time

So damn true, a lot of people are believing that there is going to be another ATH, and even the price when you look at the way it’s been going you don’t need anyone to tell you that the price will be reaching a new ATH price, the moment you look at the chart you mind tells you that.

But, once the price is above the last ATH price you’re going to see a lot of people panicking, that’s when you’re likely going to see a fall, because people will be afraid that it’s going to fall now that it has passed the last all time high price.

[Fredomago]

we know that we are in a period of the market which is experiencing extreme greed and I do not see this changing during the next days because people have a lot of hope that we are going to reach a new ATH during that time

So damn true, a lot of people are believing that there is going to be another ATH, and even the price when you look at the way it’s been going you don’t need anyone to tell you that the price will be reaching a new ATH price, the moment you look at the chart you mind tells you that.

But, once the price is above the last ATH price you’re going to see a lot of people panicking, that’s when you’re likely going to see a fall, because people will be afraid that it’s going to fall now that it has passed the last all time high price.

With that case, you also need to add it up with your plan, there are always retrace that will take place, and if influenced is much stronger for the dumper to keep selling it will happened that way. Many traders who already gaining from this market knew this alternatives, they simply adjust with the momentum and still benefits from  how the market runs.

For now, we are still seeing huge amount of investors who are positive and it shows from the current market valuations, most are still in green and the trends are still keeps on moving upwards, better to deal with it with strict but careful decisions.

[tbterryboy]

Hey guys,
By recent Fear&Greed Index bitcoin is in extreme greed area, usually it's a sign of decline in price or even crash. I've been observing this index for quite some time and find it pretty accurate, of course it doesn't give you the exact day or time but it indicates the sentiment on the market. Do you ever use this index in your trading analysis?

The OP was posted on 11th November and if you see the trend since the time of this thread posted, the price has only gone up which again makes me believe like these Fear&Greed and other charts are just not accurate or even give a rough idea. I would have respected these charts had the price stayed same but it has gone up and this clearly tells you that the crypto market at least cannot be determined by these charts and usual analysis.

I am going to buy even more Bitcoins probably once I get my salary and that is because I am expecting some new records to be set in the next year and yeah you may discuss about the crash that is going to happen, but I have my own belief in Bitcoins.

[globalpain]

greed is indeed part of the market, even traders also have the emotion of greed,
many traders are trapped because of greed, the increase that occurs is only an illusion and the dump that occurs is also just an illusion,
and causes people to regret, that is a greed that will make us exposed to the illusion of a market, so don't be greedy, be wise

[jaberwock]

I've read about extreme Greed, that extrem greed will bring the price of an asset to experience a selling action,
this happened because of an observation, yes, this is my observation too, because this tendency makes people greedy.

As we talk the price continues to rise which again proves that these extreme greed speculations and observations might mean nothing.

I do watch Fear&Greed Index and yeah, when there's too much good happening in the markets, you also need to be prepared for some "blood on the streets" kinda scenario soon. People have greed in their souls but are also afraid of losing a ton of money invested during this point of time when BTC is too high and when something hangs high, chances of an extremely huge drop are immense. My talks may sound like I'm bearish on BTC but I'm not, these are the facts which can't be overlooked. A correction or at least a retracement is incoming.

You might be right and the price might drop but as a small trader one should rather look for long term profits because someone holding 0.1 BTC won't become rich by selling at 20k or if the price drops to 15k he would only face $500 loss which is not too big although it is significant but imagine if the bull run continues and reaches something like 50k a small trader just easily 5x his money.

If you are holding 10-20 BTC then yes you should maybe sell if you think the market is going to crash soon because the profits and losses involved are massive.

[DarkDays]

With BTC rocking between high 18K and low 19K with the possibility of crossing the 20K mark at any time this year, how could you not be expecting GREED to come in?

Of course, keeping the greed level in check is important but I feel that at times like these many people forget to apply what they know already and instead go with the bull run effect. It is difficult to hold back when the market is so green...

[stomachgrowls]

With BTC rocking between high 18K and low 19K with the possibility of crossing the 20K mark at any time this year, how could you not be expecting GREED to come in?

Of course, keeping the greed level in check is important but I feel that at times like these many people forget to apply what they know already and instead go with the bull run effect. It is difficult to hold back when the market is so green...

You are right and as a human being these kind of reactions or emotions will be considered normal this is why actions made will always be that common when market is really in a bull run.
You cant say that people should be on that greedy mode but holding back that feeling is really hard to ignore.

Feeling of getting Fomo'ed will always form in times like these and the most important thing to those people who had invested on lower prices in active trading manner is to safely secure
out their profits first before making any re-entry.

Lets see if the price will have some another huge rejection or correction until it bumped the previous ATH or would completely break it out and would go further beyond.