FAQs

Macro Sentiment Index FAQs

How is the Macro Sentiment Index calculated?

MSI computes z-scores for each component over a lookback period, adjusts directionality (e.g., VIX is inverted), applies user-defined weights, and calculates a weighted average. The result is smoothed optionally with a moving average.

What does a reading of +1.5 mean?

A score above +1 indicates strong risk-on sentiment. At +1.5, most risk assets are performing well relative to history, potentially signaling euphoria or complacency. Monitor for reversals or volatility spikes.

Can I use MSI for crypto trading?

Yes. Bitcoin and crypto markets are highly sensitive to global liquidity and risk appetite. MSI serves as an excellent macro filter—avoid aggressive longs when MSI is deeply negative.

Why is the VIX given a negative sign in scoring?

Because rising VIX reflects fear and risk aversion. In MSI logic, higher fear = lower sentiment, so its z-score is negated to align with the overall scale.

Is MSI leading or lagging?

It is primarily coincident, reflecting current market sentiment. However, due to z-score normalization and aggregation, it can act as a leading indicator when divergences appear (e.g., price up, MSI down).

Is CSI suitable for intraday trading?

No.