Bitcoin (BTC) Indicator of Fear and Greed Holds steady despite BTC Sub-$20,000

the main ideas:

  • On Saturday, Bitcoin (BTC) visited below $20,000 in a 1.03% loss as investors responded more to Fed Chairman Powell’s speech.
  • Fed Chair Powell sent riskier assets into a meltdown on Friday, and there were no crypto events to shift the focus away from the Fed.
  • Bitcoin Fear & Greed remained flat at 28/100 despite BTC dropping below $20,000.

On Saturday, Bitcoin (BTC) fell by 1.03%. After a 6.03% drop from Friday, BTC ended the day at $20,049.

A mixed start to the day saw BTC reach an early high at $20386 before pulling back. Below the first major resistance level (R1) at $21,380, BTC dropped to a daily low of $19,773. However, to avoid the first major support level (S1) at $19,639, BTC returned to $21,100 before pulling back.

Investors continued to respond to Fed Chair Powell’s speech warning markets of the potential fallout from the Fed’s policy plans to bring inflation to target. For the cryptocurrency market, the possibility of significant interest rate hikes will also end the free money environment that has supported riskier assets.

On Friday, Powell spoke about the potential ramifications of the Fed’s goals, including the impact on labor market conditions. The Fed chair dispelled any hope of a policy reversal by highlighting the need for a period of sustained growth without trend coupled with a weaker labor market to adjust for inflation.

Bitcoin Fear & Greed Index Holds 28/100 as BTC Drops Below $20,000

Today, the Fear and Greed Index is unchanged at 28/100. The index has stabilized despite BTC dropping below $20,000 for the first time since July 14. The indicator remains above the area of ​​extreme fear important for the Bitcoin bulls.

A return of the index to 40/100 should support BTC’s move to $25,000, however, the recent fall into the Extreme Fear area leaves BTC’s visit to the 2022 low at $17605.

Bitcoin (BTC) Price Action

At the time of writing, BTC was up 0.11% at $20,072.

A choppy start to the Sunday session saw BTC drop to a low of $19,933 before hitting $20,082.

BTCUSD 280822 Daily Chart

Technical Indicators

BTC needs to avoid the $20,069 pivot to target the first major resistance (R1) of $20,366 and Saturday’s high of $20,386.

BTC will need a noticeable change in investor sentiment to support a return to $20,300.

An extended crypto rally will see BTC test the second major resistance (R2) at $2,682 and the $21,000 resistance. The third major resistance level (R3) is located at $21295.

A fall through the pivot would place the first major support level (S1) at $19,753. Excluding an extended sell-off, BTC should avoid below $19,000, and the second major support level at $1,456 should be the limit to the downside.

The third major support level (S3) is $18,843.

BTCUSD 280822 hourly chart

Looking at the exponential moving average and the 4-hour candlestick chart (below), it was a bearish signal. This morning, Bitcoin is below its 50-day moving average, currently at $21,306.

After a bearish crossover on Monday, the 100-day moving average pulled back from the 200-day moving average, with the 50-day moving average slipping away from the 200-day moving average, providing bearish price signals.

An additional pullback from the 50-day moving average from the 200-day moving average would put key support levels into play.

For the bulls, a move of BTC through R1 ($20,386) and R2 ($20,682) would bring in the R3 ($21,295) 50-day EMA ($21,306).

BTCUSD 280822 4-H Chart

trend analysis

Looking at the trends, BTC will need to move through the August highs at $2,5203 and $25,500 to target the June highs at $31956. Avoiding Saturday’s low of $1,773 will support a pullback towards the 50-day EMA to ease selling pressure.

For the bears, the downtrend continued on Saturday with fresh lows, with the June 18 low at $17,601 as a target. A drop to the July low of $18,768 would trigger the June and 2022 lows.

BTCUSD 280822 Trend Analysis

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