With the price of bitcoin now well over $49,000 and other crypto assets rising, traders have entered a period of “extreme greed,” according to a well-known index measuring market sentiment.

The Fear & Greed Index, published by data source alternative.me, measures market enthusiasm for bitcoin and other prominent digital assets. The last time the index reached a score of 79 out of 100 was when bitcoin hit its all-time high around $69,000 in November 2021.

“When investors are getting too greedy, that means the market is due for a correction,” said alternative.me on its website.

It’s an axiom of the market that savvy traders prefer buying when the index shows extreme fear, and that they become more cautious when greed is higher. But, of course, that might not be the case.

The index has been routinely above 70 (the threshold for “greed”) since October last year. It fell as low as 50 following the approval of bitcoin ETFs in January, which initially turned out to be a “sell-the-news” event.

Bitcoin has more than doubled in price in the last 12 months. A year ago today, one coin was worth as little as $21,000 and yesterday the price briefly rose above $50,000. The price has retreated a hair to $49,400 at press time.