On this page, you will find our latest updates on the CNN Fear and Greed Index.
The CNN Fear and Greed Index in its purest form answers the question, “What is the predominant emotion of the stock market right now?”
It’s a sentiment indicator that tells if equities are undervalued or overvalued. The logic behind it is that too much greed can push stock prices beyond their fair price, while too much fear can cause stocks to slip well below their intrinsic price, as traders don’t act rationally in the short-term.
The Fear and Greed index uses seven indicators to conclude the extent of the market’s fear and greed and measures the market’s sentiment based on these two emotions on a daily, weekly, monthly, and annual basis. The following metrics compose the index and aim to provide a holistic view of the market’s emotions:
- Put and Call Options: How much have put options lagged behind call options?
- Market Momentum: Where is the S&P 500 relative to its 125-day average?
- Stock Price Strength: It counts the number of stocks that have touched 52-week highs vs. 52-week lows on the New York Stock Exchange (NYSE).
- Stock Price Breadth: The McClellan Volume Summation Index compares the volumes on rising stocks versus declining ones.
- Safe Haven Demand: How well are stocks performing compared to safe-haven assets like US Treasury bonds?
- Market Volatility: It uses the Chicago Board Options Exchange Volatility Index (VIX) relative to its 50-moving average.
- Junk Bond Demand: What is the spread between junk bonds and safer, investment-grade corporate bonds?
How to use the Fear and Greed Index?
The seven metrics are individually-measured on a scale of 0-100 with lower numbers indicating fear while higher figures pointing to greed. They are then weighted equally to calculate the Fear and Greed Index.
The index is a great tool to help investors and traders get an idea of when it is time to enter the markets. When the Fear and Greed index is trading near its recent extreme lows it hints that a significant bottom in the market is pending. The index should be interpreted with the help of technical analysis to improve entry signals. It is also possible to use the index to figure out when the market is overbought, but at least historically, the indicator is less useful to predict significant highs.
Latest Updates
The Dow Jones is having a time of its life. The index has gained by more than 200 points in the futures market. This means that the index has gained by more than 41% since the bottom in March. While these gains are good, the fear and greed index is [...]
The Dow Jones added to yesterday’s loss as investors awaited an important speech by Donald Trump on China. The index fell as the closely followed fear and greed index crossed an important milestone. Also, it also fell as Citi’s panic vs euphoria index rose to euphoria levels. Trump speech on...
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The Nasdaq 100 continues to push towards the recovery of its 2020 highs, and this is showing up as an increase in the Fear and Greed index.
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The Nasdaq 100 is trading higher after today’s NFP numbers were better than the market expected. Despite showing a negative employment change of 20.5million, a figure not seen since the Great Depression era, the Nasdaq 100 was buoyed by the fact that the numbers were not as bad as market [...]
The Nasdaq 100 has erased losses suffered in 2020 as the Fear and Greed index continues to remain constant at 42. The Nasdaq 100 was able to close above the critical 8945.7 resistance level and is now challenging the resistance at 9092.3 in its attempt at making new highs. The [...]
What is the relationship between the Nasdaq 100 and the Fear and Greed Index? Sign up to find out more.
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The Fear and Greed Index is up, and so is the Nasdaq 100. Here's why investors are pushing the Nasdaq 100 higher with some interesting chart patterns to be seen.
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The Dow Jones futures are down 0.14% at 23,333 while the Fear and Greed is adding one point at 41 today after the April PMI's crashed in many European countries and the UK.
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The Nasdaq 100 continues its advance in early Friday trading after the US President Donald Trump unveiled plans to reopen the US economy following coronavirus-induced shutdowns and lockdowns. Furthermore, new coronavirus treatment hopes are also fuelling the advance of the Nasdaq 100, with several healthcare stocks experiencing appreciation. These events [...]
The Nasdaq 100 futures are up 2.25% on a day that has seen market optimism by investors in the global stock markets. The uptick in the Nasdaq 100 also coincides with a similar uptick in the Fear and Greed Index, which has shot up by 3 points from our last [...]
