The Crypto Fear & Greed Index measures market sentiment by aggregating data from six distinct dimensions: volatility, trading volume, social media sentiment, market surveys, Bitcoin dominance, and Google Trends data.
Currently, the index is at an all-time low of 11, suggesting a strong negative sentiment among investors. This reading can be seen as a contrarian indicator, signaling potential undervaluation in the market.
Maintaining a clear risk-management strategy, including position sizing and stop-loss orders, becomes paramount during such periods. Diversifying across asset classes and within the crypto sector itself can also mitigate specific risks.