Bitcoin Fear and Greed Index Holds Flat as Focus Turns to Inflation in the US

the main ideas:

  • On Sunday, Bitcoin (BTC) ended a four-day losing streak with a 0.13% gain to end the week at $19,444.
  • Market reaction to US economic indicators and increased bets on 75 basis points from the Federal Reserve’s rate hike in November and December have stalled.
  • However, the range-bound BTC session left Fear & Greed unchanged at 22/100.

On Sunday, Bitcoin (BTC) gained 0.13%. Partially reversing the 0.59% loss from Saturday, BTC ended the week 1.98% higher at $19,444. Notably, Bitcoin fell below $20,000 for the second time in six sessions.

A bearish start to the day saw BTC drop to an early low of $19,326. Avoiding the first major support level (S1) at $19,237, bitcoin surged to a high in the late afternoon at $19,553. However, when BTC failed to reach the first major resistance level (R1) at $19,613, BTC fell again to end the day below $19,500.

The lack of physical cryptocurrency news has allowed investors to take a breather after four consecutive sessions in the red. A modest increase in bets for a 75 basis point Fed rate hike in December left bitcoin’s range headed for the weekend.

While the probability of a 75 basis point Fed rate hike in November is 76.7%, the chance of a 75 basis point rate hike in December is 24.0% (October 9). Before the ISM non-manufacturing PMI on Wednesday and the jobs report on Friday, the probability of a 75 point increase was 0%.

With the cryptocurrency market showing continued sensitivity to the Fed’s monetary policy, the relationship with the Nasdaq is likely to remain. This morning, the Nasdaq 100 Mini Index is down 50.25 points, recovering from even larger losses.

Later today, there are no US economic indicators for the markets to consider, leaving the focus of members of the Federal Open Market Committee and the IMF and World Bank meetings.

Nasdaq Daily Chart BTCUSD 101022

Fear and Greed Index remains stable after a range-bound session

Today, the Fear and Greed Index settled at 22/100. After succumbing to BTC’s four-day losing streak on Sunday, BTC’s modest gains on Sunday left the index unchanged this morning. Nonetheless, the index remains planted in an area of ‚Äč‚Äčintense fear, with Fed concerns and economic uncertainty weighing heavily.

With market bets growing on a tighter end of the year, fears of a hard landing will continue to be a headwind for the cryptocurrency market. This week, US inflation figures may prove clueless.

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 0.30% at $19,504 and the range-limited start of the day saw BTC drop to an early low of $19,410 before climbing to a high of $19,521.

BTCUSD 101022 Daily Chart

Technical Indicators

BTC needs to avoid the $19,441 pivot to target the first major resistance level (R1) at $19,556. BTC breakout from R1 may indicate a bullish session. However, investor concerns about the Federal Reserve and the prospect of aggressive rate hikes for the rest of the year remain headwinds for cryptocurrencies.

In the event of an extended rally, BTC must breach the second major resistance level (R2) at $19,668 to target the third major resistance level (R3) at $19,895.

A fall through the pivot would trigger the first major support level (S1) at $19329. Excluding an extended sell-off, BTC should avoid below $19,000, and the second major support level (S2) at $19214 should act as a cap to the downside.

The third major support level (S3) is $18,987.

BTCUSD 101022 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 100-day moving average, currently at $19,622.

After a midweek bullish crossover of the 50-day EMA across the 50-day EMA and the 100-day EMA. The 100-day moving average pulled out from the 200-day moving average and provided bearish price signals.

A bearish crossover of the 50-day EMA across the 100-day moving average will trigger S1 ($19,329). However, a movement of BTC through R1 ($19,556) would give the bulls a run at the 100-day ($19,622) and 50-day ($19,627) moving averages.

BTCUSD 101022 4-H Chart

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