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Crypto greed gauge hits highest since just before October’s $19 billion wipeout
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- DeepHorus
The Crypto Fear & Greed Index has spiked to its highest level since just before a historic market crash, signaling a dramatic shift in trader sentiment. The index reached 74 on Tuesday, up from a reading of 27 on August 12, before easing to 65 on Wednesday. This rapid swing from fear to greed occurred in less than two weeks, with the index having been in "fear" territory since late July.
This surge in optimism is mirrored in Bitcoin's price action, which climbed from below $68,000 last week to approach $80,000. The rally has broadened to major tokens and even thinly traded memecoins, reflecting a renewed appetite for risk. For instance, Dogecoin gained about 24% over the past week, while smaller tokens like Thinking Cat and Cash Cat saw gains exceeding 100%.
The index, calculated by Alternative.me, blends factors including Bitcoin's volatility and trading momentum, social media activity, and Google search interest. A reading above 50 indicates "greed," and the current level of 74 is the highest since October 5, 2025. That date was just five days before a crash that wiped out approximately $19 billion in leveraged positions in a single session.
Market analysts note that such high greed readings can indicate that investors are becoming overconfident, potentially setting the stage for a sharp correction. The influx of money into speculative, low-liquidity tokens is seen as a classic sign of a market top. Traders are now turning back to crypto after months of focus on AI and semiconductor stocks.
The next significant test for this rally is Friday's Jackson Hole symposium. Federal Reserve Chair Kevin Warsh will deliver his first keynote as chair, and markets are seeking clues on interest rates and inflation. Recent volatility in long-term Treasury yields had helped initiate Bitcoin's run.
The swift reversal underscores the crypto market's extreme volatility and susceptibility to rapid sentiment shifts. While the current greed level suggests strong bullish momentum, historical precedent serves as a cautionary tale. The market now looks to central bank commentary for its next directional cue.
