The market is recovering after a stressful correction phase.
Fear and Greed Index is now at 40%, showing rising confidence.
A doubling from this level could indicate peak greed in the market.
This bull cycle has not been without its challenges. The recent correction phase has been one of the most stressful in this cycle, drawing comparisons to the 2021 market downturn triggered by China’s crypto mining ban. During that period, fear gripped the market, and investor sentiment took a major hit.
Fast forward to now, and we are witnessing early signs of sentiment recovery. A key metric to watch is the Fear and Greed Index, a widely followed indicator of market emotions. Based on the 30-day simple moving average (SMA30D), the index has climbed back to 40%. This level suggests that while investors are still cautious, the extreme fear has started to subside.
Understanding the Current Market Mood
The Fear and Greed Index helps gauge the emotional state of crypto investors by analyzing factors like volatility, market momentum, social media trends, and dominance. A score of 0 means extreme fear, while 100 shows extreme greed.
At 40%, the index is currently in neutral territory, hinting at improving sentiment. Importantly, if this level were to double, it would place the market near peak greed levels — a sign of extreme bullishness that often precedes corrections.
This gradual shift from fear to neutrality signals growing confidence among investors, especially after weathering one of the most intense corrections in this cycle.
This correction phase has been the most stressful in the current bull cycle, similar to the 2021 correction when mining was banned in China.
At the moment, the average (SMA30D) Fear and Greed Index has recovered and is at the level of 40%. A 2x increase will show the maximum… pic.twitter.com/iZkk7oyj1P
— Axel Adler Jr (@AxelAdlerJr) April 30, 2025
Will Greed Take Over Again?
Looking ahead, all eyes will be on whether the Fear and Greed Index continues its upward trend. If it pushes toward 80%, we might be entering overheated territory. But for now, the slow climb offers reassurance that the market is healing.
For investors, this is a moment to stay alert but not alarmed. While corrections can feel painful, they are also healthy and often pave the way for stronger rallies. Just like in 2021, those who stay patient through the stress could be well-positioned for what comes next.
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