How did a Fear and Greed Index score of 42 on January 7, 2026 reflect changes in Bitcoin market sentiment?
Why is this the correct answer?
This is correct because a score of 42 moves away from fear territory toward neutral, indicating that market participants are less panicked and more cautiously optimistic. This suggests selling pressure is abating, and both retail and institutional investors are more balanced in their outlook, which beginners should understand as a sign that the market might stabilize before making larger moves.
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