Bitcoin (BTC) Fear and Greed index dropped to 8, reaching its lowest level since 2019.
The crypto markets have not witnessed such a massive drop since March 2020.
The big drop in the indicator may cause traders to take on an even more negative mood. The biggest reason why the index went down to 8 was the collapse of LUNA and UST.
The Fear and Greed Index is often used to identify oversold/overbought situations; Extreme Fear represents the oversold market and Extreme Greed represents the overbought market.
The index measures volatility, market momentum, social media, dominance and trends. Volatility and market momentum, represented by volume, are the factors that have the most impact on the indicator.
