What is the Fear & greed index?
This indicator, which appears on Paribu under the name Fear & greed index — also known internationally as the fear and greed index (Fear & Greed Index) — expresses the overall sentiment of the crypto market on a scale from 0 to 100. Low values indicate that investors are cautious (anxious) about the market, while high values indicate that confidence is high. You can follow the index in a widget on your home screen.
What is the Fear & greed index?
The Fear & greed index is an indicator that measures the sentiment of the crypto market by combining data such as price movements, trading volume, market momentum, social media interest, and volatility. The index takes a value between 0 and 100; values close to 0 represent extreme anxiety, and values close to 100 represent extreme confidence.
The index provides a real-time summary of community behavior in the market. When investors are concerned that prices will fall, the index drops; when confidence in price increases is high, it rises.
Where can I see the index?
The Fear & greed index is not shown on the Markets screen. You can follow it in the Market metric widget: edit the widget and choose Fear/greed index under Indicator. For details on adding widgets, see Widgets, Apple Watch and lock screen.
How are index values interpreted?
The index value expresses a different market sentiment depending on the range it falls into:
The index shows which side it is on with an Anxiety or Confidence label. The value is generally interpreted as follows:
- Values close to 0 · extreme anxiety: The market is under significant selling pressure. Investor risk appetite is low.
- Below the middle band · anxiety: The market has shifted into a cautious state. Price movements may slow down.
- Middle band · neutral: The market appears balanced; there is no clear advantage between buyers and sellers.
- Above the middle band · confidence: Investors are optimistic. Buying interest increases.
- Values close to 100 · extreme confidence: The market is in an exuberant state. Sharp rallies may be seen; at the same time, the risk of correction increases.
Note: The index being low or high alone is not a buy or sell signal. The index is a supplementary indicator that helps you understand market sentiment.
How is the index used?
The Fear & greed index can be used as a starting point for investors who want to quickly assess market conditions:
- In the extreme anxiety zone, the market may be in panic. Some investors view this zone as a long-term assessment opportunity.
- In the extreme confidence zone, the market may be overheated. This carries the risk of profit-taking and volatility.
- In the neutral zone, the market has not set a major direction; for short-term decisions, it is recommended to evaluate the index together with other indicators.
It is healthier to evaluate the index value not as a standalone decision tool, but together with other data such as price charts, news, and statistics.
Warning: The Fear & greed index is an informational indicator and does not constitute investment advice. You should make your investment decisions based on your own research and risk profile.
Frequently asked questions
What data is the index calculated from?
The index is calculated using data compiled from different sources such as price movement, trading volume, market momentum, volatility, social media interest, and market dominance. Each source contributes to the index with a different weight.
How often is the index updated?
The Fear & greed index is generally updated daily. The value displayed in the Paribu app reflects the current calculation.
Why does the index change suddenly?
Factors such as major price movements, important news, or heavy trading volume can cause the index to change rapidly. Short-term fluctuations in the index directly reflect changes in market sentiment.
Can I use the index to trade?
The index does not provide a buy or sell signal on its own. In investment decisions, it is recommended to evaluate the index together with other indicators and your personal risk profile.
Related articles
- How to use the Markets screen — Using the Markets screen
- How can I view asset details? — Viewing asset details
- News feed and market news — News feed and market news
- How to set up and manage price alerts — Setting and managing price alerts
- What is profit/loss (P&L) and how is it calculated? — Calculating profit/loss (P&L)
Author:
Paribu