Fear and Greed index

A fear and greed index is a single 0 to 100 score that combines several market measures into a mood reading, where low means fear and high means greed.

How Fear and Greed index is calculated

Each published index chooses its own inputs and weights. The crypto version from Alternative.me draws on volatility, momentum and volume, social media activity and other measures, then scales the result to 0 to 100. Because the inputs are recent price moves, the index mostly describes what already happened.

How it is read

Extreme readings are described as moments of crowd fear or greed. Whether acting against them pays is a testable question.

Common mistakes

• Treating a low reading as a buy signal without a test.
• Forgetting the index is built partly from price, so it follows price rather than leading it.
• Comparing two different indices of the same name.

What Tickfloor tested

Tickfloor's research desk has backtested 678 strategies, net of modelled trading costs. After correcting for the 761 tests run, 0 passed. That does not prove no strategy works. These are historical diagnostics, not validation under Testing Standard v2: the backtest harness predates that standard and has not been re-run to meet it.

• Fear & Greed Index (claim test)
• Fear & Greed Timing (claim test)

Lessons that cover it

• Fear gauges: the VIX, funding and sentiment

• Short definition in the glossary

Related concepts

• Volatility
• Momentum
• Funding rate
• Mean reversion
• All concepts

General information only. It doesn't consider your objectives, finances or needs. Tickfloor holds no financial services licence and never places trades.

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