Bitcoin Fear & Greed Index Signals Investor Resilience Despite BTC Loss

Key Insights:

• On Friday, bitcoin (BTC) fell by 2.14% to end the day at sub-$20,000 for the second time in four sessions.
• The US jobs report sent the NASDAQ 100 and BTC deep into negative territory, with the numbers affirming a 75-basis point Fed rate hike in November.
• Despite the bearish session, the Bitcoin Fear & Greed Index increased from 23/100 to 24/100.

On Friday, bitcoin (BTC) slid by 2.14%. Following a 0.97% decline on Thursday, BTC ended the day at $19,533. Notably, BTC ended the day at sub-$20,000 for the second time in four sessions.

A bullish start to the day saw BTC rise to an early high of $20,059. Coming up short of the First Major Resistance Level (R1) at $20,321, BTC slid to a late afternoon low of $19,334.

BTC fell through the First Major Support Level (S1) at $19,732 and the Second Major Support Level (S2) at $19,505. However, finding late support, BTC moved back through S2 to end the day at $19,533.

BTC continued to track the NASDAQ on Friday, with both markets responding to the US jobs report. In September, nonfarm payrolls increased by 288k, following a 275k rise in August. The NFP increase and a fall in the participation rate left the unemployment rate at 3.5%, down from 3.7% in August.

The numbers were good enough to affirm a 75-basis point Fed rate hike in November. In response to the stats, the NASDAQ 100 slid by 3.80% to end the week up by just 0.73%.

The Fear & Greed Index Inches Higher but Remains in the Extreme Fear

Today, the Fear & Greed Index rose from 23/100 to 24/100. The Index rose despite a bearish session for BTC and the broader crypto market. While Fed fear weighed on riskier assets, the uptrend in the Index signaled investor resilience.

Ahead of Friday’s jobs report, the probability of a 75-basis point interest rate hike had stood at 73% before climbing to 79.6%.

Based on the FedWatch Tool numbers, investors were already expecting a 75-basis point hike before the jobs report, which likely prevented a fall in response to the numbers. However, uncertainty about the economic outlook and whether the Fed can avoid a hard landing continues to peg back the Index.

For the bulls, the Index will need to continue avoiding sub-20/100 to support a shift in sentiment. However, a fall to sub-20/100 would signal a BTC slide to sub-$18,000.

Bitcoin (BTC) Price Action

At the time of writing, BTC was up 0.30% to $19,591. A range-bound start to the day saw BTC fall to an early low of $19,525 before rising to a high of $19,626.

Technical Indicators

BTC needs to move through the $19,642 pivot to target the First Major Resistance Level (R1) at $19,950 and the Friday high of $20,059. A BTC return to $20,000 would signal a bullish session. However, the Friday jobs report will likely resonate throughout the session.

In the case of an extended rally, BTC should test the Second Major Resistance Level (R2) at $20,367 and resistance at $20,500. The Third Major Resistance Level (R3) sits at $21,092.

Failure to move through the pivot would leave the First Major Support Level (S1) at $19,225 in play. Barring another extended sell-off, BTC should avoid sub-$19,000 and the Second Major Support Level (S2) at $18,917.

The Third Major Support Level (S3) sits at $18,192, just below the September low of $18,210.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bearish signal. This morning, bitcoin sat below the 100-day EMA, currently at $19,665.

After the 50-day EMA bullish cross through the 100-day EMA, the 50-day EMA closed in on the 100-day EMA. The 100-day EMA pulled back from the 200-day EMA, delivering bearish price signals.

A BTC move through the 100-day EMA ($19,665) and the 50-day EMA ($19,728) would support a breakout from the 200-day EMA (19,915) and R1 ($19,950) to target R2 ($20,367). However, failure to move through the 100-day EMA ($19,665) would give the bears a run at S1 ($19,225).