Bitcoin (BTC) Tracks the NASDAQ Into the Red Amidst Ukraine Tensions

Key Insights:

• Bitcoin’s correlation with the NASDAQ 100 Mini continued on Wednesday
• News updates on Russia and Ukraine were market negative mid-week
• Technical indicators flash red, with a fall to sub-$36,500 likely to test support at $35,000

It was yet another choppy day for Bitcoin (BTC) on Wednesday. A bullish start to the day saw Bitcoin track the NASDAQ 100 Mini into positive territory before hitting reverse. Sliding from a day high of $39,310, Bitcoin fell by 2.61% to end the day at $37,271. On Tuesday, Bitcoin had risen by 3.41%.

Geopolitics continued to grip the global financial markets and the broader crypto market mid-week. Wednesday’s loss was just the 6^th in 8-sessions.

It was a mixed session for the crypto top 10, however.

LUNA rallied by 8.87% to buck the broader market trend.

XRP slid by 3.51% to lead the way down, with BNB and ADA seeing losses of 2.35% and 2.48%, respectively.

AVAX (-1.43%), ETH (-2.16%), and SOL (-2.09%) also saw red.

Bitcoin Fear & Greed Index Continues Upswing

On Wednesday, the Bitcoin Fear & Greed Index had partially recovered from 20/100 to 25/100 before hitting reverse. Despite the move through to 25/100, the index remained within the “Extreme Fear” zone before this morning’s pullback. In response to rising Ukraine tensions and Bitcoin’s Wednesday loss, the index fell back to 23/100.

For the Bitcoin bulls, the index will need to move back through to 50/100 to bring $50,000 levels back into play for Bitcoin. A fall through to sub-20/100 would deliver sub-$30,000 levels.

NASDAQ 100 Mini and Bitcoin (BTC) Correlation Remains

Escalating tensions in Ukraine weighed on the NASDAQ following the country’s declaration of a state of emergency. Fresh sanctions from the West in response to attacks on eastern Ukraine added to the selling pressure.

Bitcoin tracked the NASDAQ 100 Mini throughout Wednesday. News updates on the day quashed any market optimism that had delivered support on Tuesday. The negative sentiment across the global financial markets left the NASDAQ 100 down 2.57% on the day.

At the time of writing, the NASDAQ 100 Mini was down by 28 points.

Bitcoin Price Action

At the time of writing, Bitcoin was down by 0.89% to $37,365.

Technical Indicators

Bitcoin will need to move through the $37,872 pivot to make a run on the First Major Resistance Level at $38,660. The NASDAQ 100 Mini would need to support a breakout from $38,500.

In the event of an extended rally, the Second Major Resistance Level at $40,049 would come into play. The Third Major Resistance Level sits at $42,226.

Failure to move through the pivot would bring the First Major Support Level at $36,483 into play. In the event of an extended sell-off, Bitcoin could test the Second Major Support Level at $35,695 and support at $35,000 before any recovery.

Looking at the EMAs and the 4-hourly candlestick chart (above), it is a bearish signal. Bitcoin continues to sit well below 50-day EMA. A further pullback of the 50-day EMA from the 100-day and 200-day EMAs would place Bitcoin under more pressure.

A Bitcoin move through the 50-day EMA at the $39,400 level would provide some support.