🤑 Is it time to be greedy?

GM everyone. This is 2036, the tiny crypto newsletter with huge returns.

Here’s what we’re serving up today 🍲: the Fear & Greed Index is one of the most popular tools in crypto. It helps you understand whether it’s time to buy or sell.

Where are we now?

Let’s dig in.

🥔 Today’s meat and potatoes

Get smarter on crypto in 2 minutes

Warren Buffett famously said -

i.e. the time to buy is when others are selling. The time to sell is when others are buying.

We all inherently know that we should buy low and sell high. But it’s much harder to put into practice.

That’s because we get emotional. When crypto is down bad - like -50% in A DAY - we get scared.

And when it pops 20% every day for a week, we get FOMO. We think the good times will never stop.

It’s the quintessential crypto meme:

We also don’t know what others are feeling:

• Do we live in a crypto bubble of irrational hope?

• Or are we surrounded by naysayers who don’t see the opportunity?

That’s what the Fear & Greed Index was built for.

It takes into account:

• the current price volatility of bitcoin

• buying and selling volume and momentum

• social media sentiment

• google searches on bitcoin

… to determine, on average, whether people are fearful or greedy about bitcoin.

And remember what Warren said - the time to be greedy is when others are fearful, and vice versa.

You can find the bitcoin Fear and Greed Index here.

As of today, the Fear & Greed index is exactly 50:

This means people are neither fearful nor greedy right now. We’re somewhere in the comfortable middle.

But you can see that times of maximum fear - like in 2019 and early 2020 - were followed by huge increases in the price of bitcoin.

And periods of intense greed were followed by steep decreases in price… at least until the next bull run 😉.

Now - sentiment can change in an instant. And the market can remain greedy or fearful longer than you think is rational.

Bitcoin is already up 60% year-to-date.

But according to the Fear & Greed Index, it looks like it still has further room to run…not financial advice.

Whichever way things go - when you find yourself on the side of the majority, it’s time to pause and reflect.

🍨 Dessert

Stories to read if you have FOMO

1/ US Treasury Secretary Yellen: “US highly likely to run out of cash on June 1”

2/ ARK Invest: US at risk of losing its dominant crypto position

3/ Crypto sees 5th week of outflows on “poor sentiment” (good time to reference the fear and greed index…)

🖼️ Crypto meme of the day

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