- Stocks fear and greed index has jumped to the extreme greed area.
- Bitcoin greed index jumped to the greed level for the first time since May.
- There is a likelihood that BTC price will jump to $35,000 in the near term.
Stocks and cryptocurrency investors are turning greedy after the Federal Reserve decided to pause its interest rate hikes. Data compiled by CNN Money shows that the fear and greed index has jumped to the extreme greed area of 80.
Beneath the surface, key parts of the index like market momentum, stock price strength, stock price breadth, put and call options, and safe haven demand are all in the extreme greed area. Junk bond demand has moved to the greed area while the VIX index is in the neutral point.
Greed has also returned in the crypto industry. Data shows that the Bitcoin fear and greed index has moved to the greed area of 59. It is the first time since May that investors have turned greedy.
Greed in the crypto industry is happening as most cryptocurrencies rally. Bitcoin price is approaching the important psychoogical level if $30,000 while Ethereum has moved comfortably above $30,000. It is a sea of green in the industry, with most coins, including BNB, XRP, Cardano, and Litecoin soaring. As a result, the total market cap of all coins has jumped to over $1.3 trillion.
There are several factors that are causing this jump in cryptocurrencies. The most important is that many large companies are showing interesy in Bitcoin. Blackrock, Invesco, and WisdomTree have all filed for a spot Bitcoin ETF.
And Deutsche Bank has applied for a crypto custody license in Germany. It will take a long time for regulators to go through these applications. However, the news has helped to ameliorate the regulatory challenges we have seen in the past few weeks.
At the same time, crypto and stocks have welcomed the Fed’s decision to pause interest rate hikes during its meeting in May. This was the first time for the bank to leave rates unchanged in ten meetings. While th bank will deliver more hikes this year, the hiking cycle is about to end.
While the ongoing Bitcoin price rally could be a dead cat bounce, buyers should focus on the year-to-date high of $31,0000. A move above that level will open the possibility of Bitcoin price jumping to the next resistance point at $35,000.
