Popular crypto analyst Nicholas Merten has his eye on a key indicator that may be showing Bitcoin is hitting its bottom and preparing for a big breakout.
In a new strategy session, Merten takes a look at the fear and greed index, which gauges the overall sentiment of crypto traders and investors by utilizing a variety of data sources, such as social media, Google trends and surveys.
Merten points out that when the fear and greed index is showing maximum optimism and euphoria, it’s usually an opportune time to sell. On the contrary, when the index is showing maximum pain and anxiety like it is now, it’s usually a prime buying opportunity.
“When people are generally fearful, we get greedy. And when the general market is greedy, we get fearful. Basically when the market’s raging in this case and everyone’s taking heightened risk, heightened exposure to crypto and doesn’t really care about the price as their peg, that’s the euphoria that we want to sell into.”
The analyst says that the fear and greed index usually doesn’t spend much time showing maximum pain, and when it eases off, price usually climbs with it.
“The simple point is this. If whether you think this is a bear market in this case or a full swing mid-cycle correction, the really interesting thing is that the fear and greed index doesn’t read down here for very long. If we’re moving up here like we did here in May, August, or coming into the fall, all three of these points appeared at a time where Bitcoin and crypto markets were picking up.”
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The post Bitcoin’s Prevailing Sentiment Signaling Huge Breakout, According to Crypto Analyst Nicholas Merten appeared first on The Daily Hodl.
source https://dailyhodl.com/2021/06/27/bitcoins-prevailing-sentiment-signaling-huge-breakout-according-to-crypto-analyst-nicholas-merten/