Bullshit index...
I'm not sure if this indicator is reliable. I've been following it for months and what is curious is to see that, despite the market correction, this indicator continues to point towards the highest level in terms of GREED.
And what was this index before this market crash? I tell you. Practically the same ...
In theory, this indicator takes into account the following variables and proportions:
Volatility (25 %) We’re measuring the current volatility and max. drawdowns of bitcoin and compare it with the corresponding average values of the last 30 days and 90 days. We argue that an unusual rise in volatility is a sign of a fearful market.
A quarter of this index depends on volatility and we have just had an outstanding volatility lately...nothing change?
Market Momentum/Volume (25%) Also, we’re measuring the current volume and market momentum (again in comparison with the last 30/90 day average values) and put those two values together. Generally, when we see high buying volumes in a positive market on a daily basis, we conclude that the market acts overly greedy / too bullish.
Another quarter here, Selling Volume has spiked the last 24 hours, nothing changed then?
Social Media (15%) While our reddit sentiment analysis is still not in the live index (we’re still experimenting some market-related key words in the text processing algorithm), our twitter analysis is running. There, we gather and count posts on various hashtags for each coin (publicly, we show only those for Bitcoin) and check how fast and how many interactions they receive in certain time frames). A unusual high interaction rate results in a grown public interest in the coin and in our eyes, corresponds to a greedy market behaviour.
This might have not changed but, in any case, it is not the biggest proportion of stake
Surveys (15%) currently paused Together with strawpoll.com (disclaimer: we own this site, too), quite a large public polling platform, we’re conducting weekly crypto polls and ask people how they see the market. Usually, we’re seeing 2,000 - 3,000 votes on each poll, so we do get a picture of the sentiment of a group of crypto investors. We don’t give those results too much attention, but it was quite useful in the beginning of our studies. You can see some recent results here.
Same here.
Dominance (10%) The dominance of a coin resembles the market cap share of the whole crypto market. Especially for Bitcoin, we think that a rise in Bitcoin dominance is caused by a fear of (and thus a reduction of) too speculative alt-coin investments, since Bitcoin is becoming more and more the safe haven of crypto. On the other side, when Bitcoin dominance shrinks, people are getting more greedy by investing in more risky alt-coins, dreaming of their chance in next big bull run. Anyhow, analyzing the dominance for a coin other than Bitcoin, you could argue the other way round, since more interest in an alt-coin may conclude a bullish/greedy behaviour for that specific coin.
I don't understand why Dominance has to be included in this index, but ok.
Trends (10%) We pull Google Trends data for various Bitcoin related search queries and crunch those numbers, especially the change of search volumes as well as recommended other currently popular searches. For example, if you check Google Trends for "Bitcoin", you can’t get much information from the search volume. But currently, you can see that there is currently a +1,550% rise of the query „bitcoin price manipulation“ in the box of related search queries (as of 05/29/2018). This is clearly a sign of fear in the market, and we use that for our index.
The trend in google searches with the term "BITCOIN" is high but not the highest ever and also it has fallen during the last day...
Sorry for the post but, do you know exactly what is this index measuring? Or is it a complete bullshit?
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