Why Does the Fear And Greed Index Show Extreme Fear? | Credit: Veronica Cestari
Share
Key Takeaways
The S&P500 (SPX) trades only 5% below its all-time high.
The stock market Fear and Greed Index sits at extreme fear.
Why is there such a disconnect between the two measurements?
Market sentiment has turned sharply bearish even as the S&P 500 hovers near record highs, underscoring a widening gap between how investors feel and how stocks are performing.
The Fear and Greed Index has collapsed into “extreme fear,” a dramatic reversal from its steady climb over the summer.
The disconnect between mood and market action has traders questioning what the charts are really signaling.
All eyes now turn to Nvidia’s earnings later today—a catalyst that could either confirm the downtrend or snap the market back into risk-on mode.
Fear and Greed Index
The Stock Market Fear and Greed Index currently stands at an extreme level of fear, at 11.
The sentiment has been falling since July 2025, when it reached an extreme greed level of 75.
The decline has been gradual, and the index is nearing its April low of 4, the lowest in two years.
Get These Top Crypto Casino Offers Now!
Sponsored
Disclosure
We sometimes use affiliate links in our content, when clicking on those we might receive a commission at no extra cost to you. By using this website you agree to our terms and conditions and privacy policy.
Currently, the S&P 500 trades just 5% below its all-time high price, and while there is some caution surrounding the release of the Epstein files, sentiment is not nearly as bearish as then.
Among major tech names, Amazon (AMZN) still trades about 14% below its all-time high, while Alphabet (GOOG) is hovering just shy of its previous peak.
Even the NASDAQ 100 is only 6% off record levels—hardly the kind of drawdown that would typically push the Fear and Greed Index into deep fear territory.
The numbers make the index’s collapse even harder to reconcile with broader market performance.
S&P 500 Movement
The SPX price has fallen since its all-time high of $6,929 on Oct. 30.
Even though the decline amounts to less than 5%, it has caused a breakdown from an ascending parallel channel, which contained the price movement since June.
As noted previously, the S&P 500 has rallied by nearly 40% since its April lows, the last time the market was at extreme fear.
Another interesting development is that the Fear and Greed Index has decreased gradually since July (black circle), despite the S&P 500’s subsequent rally.
Nevertheless, the price action is worrying. The SPX breakdown was preceded by bearish divergences in the Relative Strength Index (RSI) and Moving Average Convergence/Divergence (MACD) (orange).
The indicators are now in negative territory, confirming the trend is bearish.
As a result, the S&P 500 could continue falling until it hits the 0.382-0.5 Fibonacci retracement support levels at $5,875 and $6,125.
One potential catalyst for the direction of the next movement is Nvidia, which is set to release its quarterly earnings report later today.
Since Nvidia is the largest company listed in the S&P 500, a decline in its stock price can have a significant impact on the stock market and potentially lead to a substantial decline in the market’s overall value.
The extreme fear reading raises valid concerns, especially with the S&P 500 breaking below its long-term channel and momentum indicators flipping bearish.
Nvidia’s earnings could be the spark that decides whether this downturn accelerates or reverses.
Even so, the steady decline in sentiment, despite months of rising prices, suggests that traders remain on edge due to the possibility of a collapse.
Disclaimer:
The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
Valdrin Tahiri is a cryptocurrency analyst and reporter at CCN, specializing in technical analysis with a focus on Elliott Wave theory, on-chain metrics, and fundamental research. He brings over seven years of experience in the crypto space as both a trader and writer.
He discovered cryptocurrencies in 2017 while earning his MSc in Financial Markets at the Barcelona School of Economics, which sparked a deep interest in blockchain and market dynamics. Since then, he’s contributed to top crypto outlets like BeInCrypto and CoinGape.
Valdrin also served as Community Manager of BeInCrypto’s Telegram group for three years, helping grow it into one of the largest crypto communities worldwide. His expertise in market structure and price patterns allows him to break down complex trends into clear, actionable insights.
He’s published thousands of articles covering altcoins, Bitcoin cycles, and macro trends.
