Bitcoin (BTC) Fear & Greed Index Sends a Bearish BTC Signal
On Wednesday, bitcoin (BTC) fell by 0.78% to $20,094. It was a fourth consecutive day in the red.
Appetite for riskier assets continued to weigh, with fears of a recession doing the damage.
Technical indicators are bearish, with bitcoin below the 50-day EMA.
On Wednesday, bitcoin (BTC) fell by 0.78%. Following a 2.25% decline on Tuesday, bitcoin ended the day at $20,094.
A choppy morning saw BTC fall to a low of $19,845.
Finding support at the First Major Support Level at $19,895, BTC struck a late high of $20,403 before easing back.
Despite the late rally, BTC left the First Major Resistance Level at $20,896 untested.
On Wednesday. the correlation between bitcoin and the NASDAQ remained in place, though a weakening was evident late in the US session.
US first quarter GDP numbers disappointed, with the economy contracting by 1.6%. According to previous estimates, the economy had contracted by 1.5%.
The NASDAQ 100 fell by 0.70% before recovering to end the day with a modest 0.03% loss.
At the turn of the day, the NASDAQ 100 Mini was down 10 points.
It could be another choppy day ahead for riskier assets, with US inflation and personal spending to draw interest. Another pickup in inflationary pressure and weak personal spending data would support the market fear of a recession, a negative for the NASDAQ and BTC.
Bitcoin Fear & Greed Index Delivers Modest Bitcoin Support
This morning, the Fear & Greed Index fell from 13/100 to 11/100. While the decline was modest, the pullback reflected investor uncertainty and fear of another BTC sell-off.
For the BTC bulls, the only positive was avoiding sub-10/100 levels. The recent failure to form an upward trend contributed to the latest BTC fall to sub-$20,000.
Near term, a move toward 25/100 and the “Fear Zone would shift investor sentiment. However, the Index would need to break out from its current range of 14/100 – 10/100 to head toward the 25/100 mark.
The Index last visited the “Fear Zone” on May 5, when BTC stood at $36,630.
Bitcoin (BTC) Price Action
At the time of writing, BTC was down 0.31% to $20,032.
A mixed start saw BTC rise to an early high of $20,139 before falling to a low of $20,019.
BTC left the Support and Resistance Levels untested early on.
A BTC move through the $20,115 pivot would test the First Major Resistance Level at $20,383 and resistance at $20,500.
BTC would need plenty of support to breakout from the Wednesday high of $20,403.
An extended rally would test the Second Major Resistance Level at $20,670 and resistance at $21,000. The Third Major Resistance Level sits at $21,230.
Failure to move through the pivot would bring the First Major Support Level at $19,826 into play.
Without an extended sell-off, bitcoin should avoid sub-$19,500. The Second Major Support Level at $19,555 should limit the downside.
The Third Major Support Level sits at $18,998.
Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bearish signal. This morning, bitcoin sat below the 50-day EMA, currently at $20,831.
The 50-day EMA fell back from the 100-day EMA. The 100-day EMA eased back from the 100-day EMA, bitcoin price negative.
A return to $21,500 would bring the 100-day EMA, currently at $22,000, and resistance at $22,500 in play.
However, failure to move through the 50-day EMA would leave the Major Support Levels into play.
This article was originally posted on FX Empire
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