Bitcoin mood in ‘wild’ deviation from reality as $ 53K BTC triggers ‘extreme fear’

Bitcoin (BTC) has stabilized at around $ 55,000 after falling by $ 6,000 in a single day – but the mood in the crypto market is still in shock.

According to Crypto Fear & Greed IndexNovember 27, the emotions are now at their most fearful since late September.

Crypto-mood plunges into “extreme fear”

Fear & Greed, which takes a basket of factors to calculate a standardized sentiment score for crypto markets from 1-100, is currently at 21.

Friday took its toll on the metric, and the score was more than halved in 24 hours from its previous position of 47.

These two readings correspond to emotions going from “neutral” to “extreme fear” – completely missing the “fear” zone.

Crypto Fear & Greed Index. Source: Alternative.me

Mens en expected response, the upheaval apparently the emotional state of the market participants is becoming a source of amusement for some well-known names.

Investor and entrepreneur Alistair Milne noted that “extreme fear” is hardly an appropriate response to BTC / USD trading at $ 54,000. In fact, the last time the Bitcoin spot price was at these levels in mid-October, Fear & Greed measured 78 – “extreme greed” territory.

“So much fear and we’re at $ 54k. Wild,” he said summarized.

On September 30, when the index last hit 21/100, BTC / USD traded at around $ 43,800 on Bitstamp.

BTC / USD 1-day light chart (bit stamp). Source: TradingView

Funding rates see overnight reset

Like Cointelegraph reported, the latest and deepest phase of the BTC price correction came as traders’ habits on stock exchanges remained strangely optimistic.

Financing rates, which was positive despite Friday’s move, showed that market expectations were a rapid recovery.

Related: Bitcoin turns ‘bear market’ to $ 53.5K as Pfizer wins new panic over coronavirus ‘Now’ variant

At the time of writing on Saturday, however, it seems that the trip to lows of $ 53,500 was enough to reset the mood – financing rates are now back to normal and show no bullish bias.

Bitcoin financing rates chart. Source: Coinglass

However, as noted by research firm Delphi Digital this week, funding is still lower compared to the first half of 2021 – and this may signal a lack of overall direction.

“Financing rates remain low in futures markets. This may be a sign that short-term leveraged traders are still unresolved directionally,” say researchers. told Twitter followers.

“Looking back at the beginning of the year, the bullish rise has been accompanied by a markedly higher funding rate.”