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Sentiment as leading indicator

Investor sentiment is tracked both for the market and the crypto market: measured in the emotions of fear and greed it provides overall sentiment of the crowd back tested it shows that statistically we get a brief bounce once we dip into the extreme fields:

followed by a brief return back to less strong emotions:

to finally end up in more extreme readings to be the final indicator of a stronger reversal

the great news are that both moves, the first price reversal after entering an extreme emotion field for the first time and the effective larger time frame tuning point in price are lagging the fear&greed index in short, public consensus of extreme emotions is a leading indicator and can as such be used as a stack able tool for identifying low risk entry points

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