Simulated Fear & Greed (CNN-calibrated v2)

🧭 Fear & Greed Index — TradingView Version (Simulated CNN Model)
🔍 Purpose

The Fear & Greed Index is a sentiment indicator that quantifies market emotion on a scale from 0 to 100, where:

0 represents Extreme Fear (capitulation, oversold conditions), and

100 represents Extreme Greed (euphoria, overbought conditions).

It helps traders assess whether the market is driven by fear (risk aversion) or greed (risk appetite) — giving a high-level view of potential turning points in market sentiment.

⚙️ How It Works in TradingView

Because TradingView cannot directly access CNN’s or alternative external sentiment feeds, this indicator simulates the Fear & Greed Index by analyzing in-chart technical data that reflect investor psychology.

It uses a multi-factor model, converting price and volume signals into a composite sentiment score.

🧩 Components Used (Simulated Metrics)
Category Metric Emotional Interpretation
Volatility ATR (Average True Range) High ATR = Fear, Low ATR = Greed
Momentum RSI + MACD Histogram Rising momentum = Greed, Falling = Fear
Volume Activity Volume Z-Score High positive deviation = Greed, Low = Fear
Trend Context SMA Regime Bias (50/200) Downtrend adds Fear penalty, Uptrend supports Greed

These elements are normalized into a 0–100 scale using percentile ranks (like statistical scoring) and then combined using user-adjustable weights.

⚖️ CNN-Style Calibration

The script follows CNN’s five sentiment bands for clarity:

Range Zone Colour Description
0–25 Extreme Fear 🔴 Red Panic, forced selling, capitulation risk
25–45 Fear 🟠 Orange Uncertainty, hesitation, early accumulation phase
45–55 Neutral ⚪ Gray Balanced sentiment, indecision
55–75 Greed 🟢 Light Green Optimism, trend continuation
75–100 Extreme Greed 💚 Bright Green Euphoria, risk of reversal

This structure aligns visually with CNN’s public gauge, making it easy to interpret.