Data shows the Bitcoin market sentiment has seen a sharp turnaround recently as the Fear & Greed Index has swung to extreme fear.

Bitcoin Fear & Greed Index Is Back In Extreme Fear Zone

The “Fear & Greed Index” refers to an indicator created by Alternative that tells us about the average sentiment present among traders in the Bitcoin and wider cryptocurrency markets.

The index uses the data of the following five factors to determine the investor mentality: market cap dominance, trading volume, volatility, Google Trends, and social media sentiment. To represent the sentiment, it uses a numerical scale running from zero to hundred.

When the value of the Fear & Greed Index is greater than 53, it means a sentiment of greed is shared by the majority of traders. On the other hand, the indicator being below 47 implies the dominance of fear. All values lying between these two cutoffs correspond to a net neutral mentality.

Besides these three core regions, there are also two ‘extreme’ zones, known as the extreme fear (occurring at 25 and under) and extreme greed (above 75). At present, the market sentiment is in one of these zones, as the Fear & Greed Index’s latest value suggests.

As displayed above, the Bitcoin market sentiment is just inside the extreme fear territory right now, with the Fear & Greed Index sitting at 24. This level of despair among traders is a new development, as just earlier mood was much better.

On January 15th, the index had a value of 61, putting the sentiment of the average investor firmly inside the greed territory. Only six days later, the situation has completely flipped.

The reason behind this shift lies in the bearish price action that the cryptocurrency has faced since US President Donald Trump announced tariffs on several European countries over Greenland.

The earlier greed sentiment also came after trader mentality saw a sharp swing. In fact, the shift was even faster back then, as the Fear & Greed Index went from a near-extreme fear level of 26 to the greedy value of 61 over just two days as Bitcoin witnessed a price surge beyond $97,000.

The latest drop back into the extreme zone may not entirely be a negative development for the cryptocurrency, though, if history is anything to refer to. Often, digital asset markets have tended to move in the direction that goes contrary to the expectations of the majority.

Since extreme fear is where a bearish mentality is the strongest, bottoms can be likely to occur in the zone. Similarly, extreme greed can lead to tops instead. With the sentiment currently in the former zone, it now remains to be seen how long it will take for Bitcoin to find back its footing.

BTC Price

Bitcoin dropped under $88,000 earlier in the day, but the coin has since bounced back to $90,200.

According to the Crypto Fear & Greed Index, investor mood has swung back toward optimism, registering a score of 61 on Thursday. That is the first time the gauge has moved into the “greed” zone since the large market fallout on Oct. 11, when roughly $19 billion in liquidations drove many traders from altcoins. The index had climbed to 48 just a day earlier, moving out of “neutral” and signaling a quick change in sentiment.

Crypto Fear And Greed Shifts

The index combines several signals — price moves, trading activity, momentum, Google search interest and social media chatter — to produce a single reading. Based on reports, the measure fell into low double digits several times during November and December after the October sell-off. A score of 61 does not imply euphoria, but it does show growing confidence among traders after weeks of anxiety and patience being tested.

Bitcoin Price Rebounds

Bitcoin’s price has been moving in step with the improving mood. In the past seven days, Bitcoin rose from $89,750 to a two-month high of $97,720 on Wednesday, according to data from CoinMarketCap. That level was last seen on Nov. 14, when the market was still struggling and sentiment readings were weak even as prices briefly touched similar highs. Market watchers say the recent rally has helped lift trader confidence and is one of the main reasons the index improved so fast.

Retail Exit And Exchange Supply

According to market intelligence firm Santiment, there was a net drop of 47,244 Bitcoin holders over a three-day stretch. Reports have disclosed that many small investors left their positions, a reaction blamed on FUD and impatience. At the same time, the amount of Bitcoin held on exchanges fell to a seven-month low of 1.18 million BTC. Less supply sitting on exchange platforms tends to lower the immediate risk of a large, sudden sell-off.

What This Means For Traders

Traders use sentiment tools as one input among many when deciding whether to buy, sell or wait. A return to “greed” suggests more people are willing to buy, which can push prices higher if buying pressure continues. On the other hand, sentiment can flip quickly; a sharp move back down would likely make some traders nervous again. Analysts point out that a shrinking pool of retail participants can leave the market in the hands of more committed holders, which often supports steadier price action.

From Anxiety To Optimism

Based on reports and current readings, the market has shifted from anxiety toward a more upbeat mood, backed by Bitcoin’s recent gains and lower exchange balances. That combination is seen by many former skeptics as a healthier setup than the panic-filled trading seen after the October liquidations. The picture is cautiously positive: optimism is rising, but the swings that define crypto markets have not disappeared.

Featured image from Unsplash, chart from TradingView

Sentiment in the Bitcoin market has marked an improvement recently as the Fear & Greed Index has surged into the neutral zone for the first time in months.

Bitcoin Fear & Greed Index Is Now Pointing At ‘Neutral’

The “Fear & Greed Index” refers to an indicator created by Alternative that tells us about the average sentiment present among traders in the Bitcoin and wider cryptocurrency markets. It determines the investor mentality using the data of five factors: market cap dominance, trading volume, volatility, social media sentiment, and Google Trends.

To represent the sentiment, the index makes use of a numerical scale running from 0 to 100. All values below 47 correspond to fear among the investors, while those above 53 reflect the dominance of greed. The metric being between the two cutoffs suggests a net neutral sentiment.

Now, here is how the current market sentiment is like, according to the Fear & Greed Index:

As is visible above, the index has a value of 48 right now, indicating that sentiment around Bitcoin is neutral. This is a sharp change from how the market mood looked just yesterday.

The Bitcoin Fear & Greed Index had a value of 26 on Tuesday, which means that the investor sentiment was deep inside the fear zone. The reason behind the turnaround in trader mood has been the coin’s recovery rally, which has now taken its price beyond the $97,000 level.

Since the Fear & Greed Index hasn’t made it into the greed zone yet, investors still look to be hesitant about embracing the bullish price action. In the past, the cryptocurrency market has often tended to move against the expectations of the majority, so the fact that traders aren’t outright greedy yet could actually be a positive sign for the rally’s sustainability.

That said, the latest jump in sentiment has been a rapid one, so the indicator could be to keep an eye on in the coming days, as a venture into the greed zone could very well be next.

The current break into the neutral zone reflects the first time since late October that the Fear & Greed Index has surged into the region. A greedy sentiment hasn’t been witnessed since the first half of October, more than three months ago.

In some other news, the new Bitcoin recovery run has triggered a large amount of liquidations, as revealed by on-chain analytics firm Glassnode.

“Across the top 500 cryptocurrencies, the latest move triggered the largest short-liquidation event since 10/10,” explained Glassnode.

BTC Price

At the time of writing, Bitcoin is floating around $97,500, up more than 7% in the last seven days.

Bitcoin Magazine

Bitcoin Price Trades Near $87,000 as Market Slips Into ‘Extreme Fear’

Bitcoin price hovered above $87,000 today as market sentiment and the Crypto Fear and Greed Index plunged to 11 out of 100, a level signaling extreme fear among investors.

At the time of writing, the bitcoin price is trading at $87,696, up roughly 2% over the past 24 hours, according to market data. Despite the modest rebound, BTC remains trapped in a choppy consolidation range, sitting just 0.2% below its seven-day high of $87,918 and 2% above its weekly low near $85,575.

Yesterday, the bitcoin price cratered from close to $90,000 to the mid $85,000s.

Trading volume over the past day totaled approximately $51 billion, suggesting continued participation but little conviction on either side of the market. Bitcoin’s total market capitalization stood at $1.75 trillion, reflecting a 2% increase over the prior 24 hours, according to Bitcoin Magazine Pro data.

The uneasy price action comes as sentiment has turned decisively bearish. The Fear and Greed Index—a composite indicator that incorporates volatility, volume, social media trends, and momentum—has fallen deep into its lowest category, historically associated with panic-driven selling and heightened emotional decision-making.

Extreme fear hits crypto markets

A reading of 11 places the market firmly in “extreme fear,” a zone typically marked by heightened downside anxiety and risk aversion. Historically, such conditions have often coincided with local bottoms, though timing remains uncertain.

The index operates on a 0–100 scale, where readings below 25 indicate extreme fear and levels above 75 suggest extreme greed. 

At current levels, investors appear more concerned about further downside than missing potential upside, reinforcing the defensive tone seen across digital asset markets.Market participants often view extreme fear as a contrarian signal, arguing that widespread pessimism can create favorable long-term entry points. 

Thin liquidity amplifies downside moves

Bitcoin price’s recent slide below the $90,000 level occurred during typically illiquid weekend trading, exacerbating volatility as sellers encountered limited buy-side support. Prices fell from the low-$92,000 range late last week to weekend lows near $87,000, marking one of the sharpest short-term pullbacks since October’s all-time high.

The broader crypto market mirrored bitcoin’s weakness. Major altcoins continued to post double-digit monthly losses, while bitcoin dominance climbed toward 57%, underscoring a flight to relative safety within the digital asset complex.

Muted volumes suggest the move lower reflects caution rather than capitulation, with traders reluctant to deploy fresh capital ahead of key macroeconomic events.

Globally, attention is also turning to Japan, where the Bank of Japan is widely expected to raise interest rates. Such a move could pressure yen-funded carry trades that have supported global risk assets over the past year, potentially adding another headwind for crypto markets.

Bitcoin price levels in focus

From a technical perspective, analysts are closely watching the mid-$80,000 range as near-term support. A sustained break below this zone could open the door to a deeper retracement toward the low-$80,000s or below. 

Conversely, holding current levels would reinforce the view that the bitcoin price remains range-bound rather than entering a prolonged bearish phase.

Despite the gloomy mood, long-term narratives remain intact for many investors, particularly as institutional participation continues to expand through spot bitcoin ETFs and broader regulatory clarity.

For now, however, bitcoin’s price action reflects a market caught between structural optimism and short-term fear—an uneasy balance that has pushed sentiment to one of its most pessimistic readings of the year.

Despite all this, earlier today, asset manager Bitwise released a new report that argues that bitcoin is poised to break from its historical four-year market cycle, setting new all-time highs in 2026 while becoming less volatile and less correlated with equities.

At the time of writing, the bitcoin price is $87,706.

This post Bitcoin Price Trades Near $87,000 as Market Slips Into ‘Extreme Fear’ first appeared on Bitcoin Magazine and is written by Micah Zimmerman.