Extreme Fear is driving the US market
On Monday, our premium newsletter covered the latest macro trends shaping the US stock market, the nonfarm payrolls report, and the declines across the three major indices. We also broke down the biggest movers within our Insider Portfolio. Every market shift is a chance to learn, and we hope readers gained valuable insights from the past week’s volatility.
This Wednesday, we turn our focus to the Fear & Greed Index, a key sentiment indicator that reveals how investor emotions drive market fluctuations.
Understanding the Fear & Greed Index
The Fear & Greed Index, developed by CNN Business, measures market sentiment on a scale from 0 to 100. Lower values indicate fear (potential undervaluation), while higher values signal greed (potential overvaluation).
0-25: Extreme Fear 🟥
26-49: Fear 🟧
50: Neutral 🟨
51-74: Greed 🟩
75-100: Extreme Greed 🟦
When the index falls into the Fear zone, investors are panic-selling, sometimes creating buying opportunities. Conversely, a move into the Greed zone suggests excessive optimism, often preceding a market correction.
How It's Calculated
The index is based on seven indicators, each measuring different aspects of investor sentiment and each component contributing equally to the overall score:
Currently, extreme fear is gripping the market. On 25th February 2025, the Fear & Greed Index dropped below 25, officially entering the Extreme Fear category. As of 11th March, the index has fallen further to 15, reflecting deepening uncertainty in US markets.
What Happens During Extreme Fear?
Looking at past instances of Extreme Fear provides valuable insights into how markets react under pressure. The last two occurrences were:
📉 5th August 2024: Global Sell-Off & Economic Uncertainty
Weak tech earnings and disappointing US jobs data triggered a major sell-off.
The Bank of Japan’s unexpected rate hike prompted investors to unwind yen carry trades, worsening the global downturn.
Japan’s Nikkei 225 plunged 12% in a single day.
The S&P 500 dropped over 4%, driven by economic slowdown fears.
The IMF issued a warning, suggesting heightened volatility could be a precursor to long-term instability.
📉 19th December 2024: Fed’s Hawkish Stance Sparks Panic
The Federal Reserve signaled that higher interest rates could remain in place longer than expected.
The US dollar surged to a two-year high, creating headwinds for emerging markets.
Bitcoin collapsed by 15% in a single week.
The Dow Jones Industrial Average tumbled 1,200 points as investors reevaluated expectations for 2025 rate cuts.
What’s Next for the Market?
The Fear & Greed Index serves as a gauge of overall market sentiment. Many investors tend to be emotional and reactive, often making decisions based on fear or greed rather than fundamentals. This index helps investors recognise their own biases and avoid impulsive trading decisions.
By using the Fear & Greed Index alongside fundamental analysis and other indicators, investors can gain a more comprehensive view of market conditions and make informed decisions.
As investors navigate another period of Extreme Fear, the key question is: Are we looking at a buying opportunity or just the start of deeper declines?
With uncertainty rising, all eyes are now on upcoming economic data and Federal Reserve policy signals. Will the market stabilise, or is further downside ahead? Beyond the U.S., are international markets presenting alternative investment opportunities? Stay tuned—our next premium edition will break it all down.
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In Case You Missed It 📬
North Korean Hackers Cash Out £232M from Record-Breaking Crypto Heist
The Lazarus Group, a North Korean hacking syndicate, has successfully laundered over £232 million from a £1.1 billion cryptocurrency heist—the largest in history. Law enforcement agencies have been scrambling to track the stolen Ethereum, but experts warn that around 20% has already ‘gone dark’, making recovery increasingly unlikely.
Crypto investigators say North Korea is one of the world’s most sophisticated crypto launderers, operating with near-military precision. Analysts believe the hackers are working in shifts, using automation to obscure the money trail, making it nearly impossible to reclaim the stolen funds. Despite efforts to freeze transactions, the regime’s closed financial system presents a significant challenge. Authorities remain on high alert, but the odds of retrieving the majority of the loot look slim.
📊 Aging Populations: The Global Shift in Numbers
The world is graying, and some countries are aging faster than others. Here’s a data-driven breakdown of where aging populations are most concentrated and where the highest percentages of elderly citizens can be found.
Top 5 Countries with the Largest 65+ Population (Total Numbers, 2024)
🇨🇳 China – 202 million (14.3% of total population)
🇮🇳 India – 99.5 million (6.9%)
🇺🇸 United States – 58.4 million (17.4%)
🇯🇵 Japan – 36.8 million (29.6%)
🇧🇷 Brazil – 22.4 million (10.6%)
Why It Matters: These nations risk population decline, pension system strain, and labor shortages, forcing policy shifts toward immigration, automation, and higher retirement ages.
🔮 Future Outlook: What’s Next?
🚀 By 2050: China’s elderly population is expected to double to 420 million, meaning nearly 1 in 3 Chinese citizens will be over 65. India will surpass China as the most populated country but will also see its senior population triple. Japan could hit 35% elderly, making it the first “super-aged” society of this scale.
🛠️ How Countries Are Preparing:
China & India – Struggling to fund pensions as traditional family-care models erode.
U.S. & U.K. – Debating higher immigration levels to offset labor shortages.
💡 The Bottom Line: Aging will reshape economies, workforces, and global power structures. Countries that innovate solutions now will stay ahead of the demographic curve.
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