Crypto Fear & Greed Index Reclaims Neutral (40); Bitcoin Holds $91K

Sentiment Reset: Fear Evaporates, Caution Remains

For the first time since the October 10 flash crash, the Crypto Fear and Greed Index has exited "Extreme Fear," printing a 40 (Neutral) this morning. The shift marks a psychological break from late 2025, where the metric languished at a capitulatory low of 10.

The recovery comes as Bitcoin (BTC) demonstrates unexpected resilience, holding the $91,000 level despite a weekend of geopolitical friction involving U.S. military maneuvers in Venezuela.

The Institutional Context

This neutrality is less about bullishness and more about the exhaustion of sellers. After Bitcoin collapsed from its $125,000 all-time high to ~$80,000 in November, a 35% drawdown that wiped out over-leveraged longs, the market has spent two months stabilizing. The return to "Neutral" signals that the forced liquidation cycle is likely complete.

"The index falling to 10 in November was the capitulation signal. A move to 40 suggests the market has priced in the known risks, including the current geopolitical headwinds."

While the recovery is a positive signal for the start of 2026, volume remains thin. Traders are hesitant to re-enter risk-on positions aggressively until BTC reclaims the $95,000 structural support.