the main ideas:
- On Wednesday, Bitcoin (BTC) ended a two-day bullish rally with a modest loss of 0.92%.
- US economic indicators raised bets on the Fed’s hawkish policy move in November, weighing on riskier assets.
- However, the Bitcoin Fear & Greed indicator moved from the Extreme Fear zone, increasing from 25/100 to 26/100.
On Wednesday, Bitcoin (BTC) was down 0.92%. Partially reversing the 3.63% rally from Tuesday, BTC ended the day at $20,156. Notably, BTC held the $20,000 handle for the second time since September 17.
A mixed start to the day saw Bitcoin climb to an early high at $20363, and below the first major resistance (R1) level at $20757, Bitcoin dropped to an afternoon low at $19,750. However, when BTC entered the range of the first major support level (S1) at $19,716, BTC bounced back to end the day at $20,156.
BTC tracked the Nasdaq throughout the US session, with both markets responding to US economic indicators on the day.
According to the ADP, the number of nonfarm payrolls rose by 208,000 in September, up from 185,000 in August. In September, the ISM Non-Manufacturing PMI fell from 56.9 to 56.7. Notably, the ISM non-manufacturing employment sub-index rose from 50.2 to 53.0, with new orders rising at a steady clip.
Employment figures reflected the view that labor market conditions are abating, supporting a hawkish Fed. FOMC member Mary Daley delivered an upbeat message on Wednesday by reaffirming the Fed’s commitment to making inflation a target.
On Wednesday, the Nasdaq 100 index fell 0.25%, ending a two-day streak of small gains. The NASDAQ 100 Mini is up 67.75 points this morning.
Later in the day, US jobless claims and Fed speeches will influence as markets prepare for Friday’s non-farm payroll.
Bitcoin Fear & Greed indicator leaves the area of intense fear
The Fear and Greed Index rose today from 25/100 to 26/100. Despite the bearish BTC session, BTC’s return to $20,000 supported the exit from the area of intense fear. The index last sat outside the extreme fear zone on September 18th.
Notably, the move came amid increasing bets for a 75 basis point Fed rate hike in November.
For the bulls, the index will need to continue to avoid below 20/100 to support the change in sentiment. However, a dip below 20/100 indicates BTC sliding below $18,000.
Bitcoin (BTC) Price Action
At the time of writing, BTC is up 0.95% at $20,347 and a bullish start to the day has seen BTC climb from an early low of $20,151 to $20,455.
BTC tested the first major resistance level (R1) at $20,429 before pulling back.
BTC needs to avoid the $20,090 pivot to re-target the first major resistance (R1) at $20,429 and the $20,500 resistance. BTC’s move through $20,500 may indicate a bullish session.
In the event of another extended rally, BTC should test the second major resistance (R2) at $20,703, the $21,000 resistance and the third major resistance (R3) at $21,316.
A fall through the pivot will trigger the first major support level (S1) at $19,816. Excluding an extended sell-off, BTC should avoid below $19,500 and the second major support level (S2) at $19,477. However, positive weekly US jobless claims numbers and hawkish talk from the Federal Reserve should pressure BTC later today.
The third major support level (S3) is $18,864.
Looking at the exponential moving average and the 4-hour candlestick chart (below), it was a more bullish signal. This morning, Bitcoin is above its 200-day moving average, currently at $19,920.
After a bullish crossover of the 50 day EMA across the 100 day moving average, the 50 day moving average moved away from the 100 day moving average. The 100-day moving average has fallen to the 200-day moving average, which is giving bullish price signals.
A bullish crossover of the 50-day EMA to the 200-day exponential moving average would support the breakout from R1 ($20,429) to target R2 ($20,703) and $21,000. However, a fall through the 200-day EMA ($19,920) would give the bears a run in the S1 ($19,816), 50-day ($19,653) and 100-day ($19,619) SMA.
BTC Fear & Greed Index Leaves Severe Fear on the Lower BTC Signs – Coinphony [SV]