Market sentiment — the overall attitude of investors — is a powerful predictor of short-term price movements. Here's how to measure and trade it.
Sentiment Sources
- Fear & Greed Index — Aggregated sentiment score (0-100)
- Social media analysis — Twitter, Reddit sentiment
- On-chain flow — Exchange inflows/outflows indicate sentiment
- Funding rates — Perpetual futures show long/short bias
Trading with Sentiment
Extreme readings are contrarian indicators. When Fear & Greed hits 10 (Extreme Fear), it's historically a buying opportunity. When it hits 90+ (Extreme Greed), take profits.
AI Agent Integration
Your AI agent can combine sentiment with price data for smarter trades. CryptoBoss provides both in a single MCP toolset.