Fear & Greed Index: a sentiment gauge that mostly works

The Fear & Greed Index condenses several volatility, momentum and breadth signals into a single 0-100 reading of market mood.

What goes into the number

The crypto version (alternative.me) weighs volatility, market momentum/volume, social media activity, dominance and (historically) survey data. The S&P version uses junk bond demand, market momentum, breadth, put/call ratios and safe-haven demand.

The output is a single number from 0 (extreme fear) to 100 (extreme greed). Below 25 the market is mostly afraid; above 75 mostly greedy.

How to actually use it

"Be fearful when others are greedy" works when everyone is greedy. Fear and Greed Index < 25 has historically marked decent entry points for long-term positions; > 75 has marked decent profit-taking points. Backtests confirm this on multi-year horizons.

What it does not do: time trades. The index can stay extreme for weeks. Treating < 25 as "buy now" without other context generates losses on the way down before the bottom.

How Signodex surfaces sentiment

Signodex displays the current Fear & Greed reading in the market overview and the AI Market Summary references it ("Index at 18 — extreme fear; multi-week low set yesterday"). The number contextualises the AI's indicator-driven analysis but does not drive any trading instruction.