Bitcoin Sentiment Index Hits 2-Year High as Rate Hike Looms

CryptoQuant's Unified Sentiment Index has hit an extreme level of 'extreme greed' at 89, its highest point in two years. Analyst Darkfrost notes that this reading is identical to what was seen in March 2024.

Darkfrost suggests that extreme readings on the sentiment index often signal a market turning point, and warns that investors have reached euphoric levels not seen since March 2024.

The current spot momentum for Bitcoin has fallen by 30% over the past week, while spot volume has risen nearly 10% in the last 24 hours to $6.9 billion.

Historically, rising interest rates have put downward pressure on Bitcoin, and with the CME FedWatch tool now pricing in an upcoming rate hike of 375-400 bps, investors are bracing for a potential decline.