How does the Crypto Fear & Greed Index reflect investor mood after a sharp price drop?
Why is this the correct answer?
This is correct because the Crypto Fear & Greed Index is a sentiment gauge that ranges from zero to one hundred. When prices fall sharply, the index often moves toward the Extreme Fear zone, indicating that many investors are selling in panic. For beginners, it helps to know that a reading below thirty often signals fear, as participants worry about further losses. Extreme fear can create buying opportunities because it suggests pessimism is at a peak and sellers may be exhausted.
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