After Donald Trump's victory in the US elections, the crypto sentiment of the market changed towards 'extreme greed' as seen in the Bitcoin (BTC) surge to $76000 yesterday.
A crypto investors’ emotions measuring tool indicated that the market was gripped by the fear of missing out (FOMO) profits, leading to a buying spree which showcased the bullish sentiment of the market after Trump's win.
The Crypto Fear & Greed Index was found to be trading in the “Extreme Greed” zone when the markets opened on November 7. This suggests that the overall crypto trading volume has risen in the last 24 hours. Much of this is due to more crypto investors entering the market to take the benefits of Trump's win as prices were expected to soar.
The Index is at a 3-month high at present, which was also seen on October 30 in the run-up to the US elections. This score on the Greed Index comes at a time when the news of Donald Trump winning the US elections caused Bitcoin to cross the $76000 mark, setting a new record. Earlier on Tuesday end of the day BTC went past its ATH to touch the $75000 mark. Crypto analysts are upbeat about this as this has created a new support level at 70000 for Bitcoin.
The Crypto Fear and Greed Index is known to measure sentiments across the crypto market, especially BTC. The Index has a 0-100 range with 0-24 signalling ‘Extreme Fear’ which stands for traders becoming concerned about the crypto market.
At this level, the coin’s price is expected to decline as traders start to panic selling. However, some analysts call the Extreme Fear signal an indicator of buying opportunity. This leads to a strategy of buying when others are fearful which might lead to an undervalued market.
On the other hand, a 75-100 range on the Index means an “Extreme Greed” situation where crypto investors are more optimistic about a price surge, resulting in an overbought market. This indicates that the crypto market is at its peak and a price correction might be in sight.
This index is a potential tool for crypto investors to understand whether a coin is heading towards price correction or if it is undervalued.
In the aftermath of the US election results crypto traders are showing a high greed index as they think that Donald Trump's pro-crypto stance will boost the price of Bitcoin and other cryptocurrencies, making it touch the $100,000 mark.
Trump's win means fewer regulatory restrictions for the crypto market which is driving the surge in buying activity.
The CEO of Concordium Boris Bohrer-Bilowitzki thinks Trump becoming the 47th US President is a “favourable scenario” for the crypto companies, globally and domestically. Underlining the connection between Elon Musk and Donald Trump, he drew a conclusion that Musk could be up for a major role in the Trump administration.
“Musk has long supported crypto and other digital assets, so any involvement of his in the next US government can only be a win for the industry,” the Concordium CEO added.
At the time of writing, Bitcoin was trading at $75103, up 2.41% in the last 24 hours with a market cap of $1.48 trillion. The trading volume of BTC has decreased by 21.48% to touch $76.23 billion.