While the crypto market shows a modest rise, the feeling of “extreme greed” persists despite a significant sell-off in bitcoin futures expiring in June.
Crypto Fear and Greed Index remains in “extreme greed” zone
The Crypto Fear and Greed Index (CFGI), which gauges market sentiment using various indicators such as volatility, market momentum, volume, and social media trends, shows a score of 78, synonymous with “extreme greed”. Over the past month, the score has fluctuated between “greed” and “extreme greed,” even reaching 81 30 days ago.
This apparent euphoria contrasts with the weekly performance of bitcoin, down 1.4% against the US dollar. BTC is currently trading 5.3% below its March 14 high of $73,794. In the derivatives market, balance prevails with 52.23% long positions versus 47.77% short positions in bitcoin.
Record Clearance of Perpetual Futures Contracts
Despite this feeling of “excessive greed”, QCP Capital reports a significant increase in the sale of bitcoin and ether perpetual futures contracts expiring in June. “ This compressed the front end and flattened the entire forward curve to 15-17% in all cases“, specifies the company.
Over the past 24 hours, approximately $28.02 million worth of bitcoin short positions have been liquidated. This unprecedented selloff in perpetual futures, however, appears to have little impact on the market's prevailing optimism, with the CFGI still interpreting the strong buying activity as a sign of “excessive greed.”
Despite the resilience of bitcoin's price in the face of selling pressure, June's record futures selloff raises questions about the sustainability of the sentiment of “extreme greed” in the market. Investors will need to closely monitor developments in the coming weeks.
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