Crypto Fear and Greed Index Flips to Greed as $1.2B Short Squeeze Sends Bitcoin Near $70K
The Crypto Fear and Greed Index surged 16 points overnight to 62, marking one of the sharpest sentiment flips this year. A $1.23 billion short liquidation cascade fueled the rally, pushing Bitcoin toward $70,000 and Ether up 18.5%. However, a 20% drop in exchange stablecoin reserves suggests order book depth remains thin.
Market sentiment pulled a total U-turn overnight as the Fear and Greed Index catapulted from 46 to 62. The 16-point daily jump marks one of the sharpest mood swings of the year, driven by a relentless rally across major assets. Bitcoin charged toward $69,803, while Ether spearheaded the breakout with an 18.5 percent surge to $2,259.
The sudden market re-rating was accelerated by leverage. Over $1.23 billion in short positions were forced into liquidation as bearish bets unraveled in a rapid cascade, forcing traders to buy back spot and futures at elevated levels. Solana and XRP also joined the expansion, gaining 11.9 percent and 11.2 percent respectively.
Despite the sudden euphoria, underlying liquidity conditions urge caution. Exchange-held stablecoin reserves have dropped nearly 20 percent, indicating that idle sidelined cash is historically low. With leverage flushed and order books thin, the market now faces a test of whether genuine spot demand can sustain the higher range.