BTC Fear & Greed Index Avoids Extreme Fear Despite a NASDAQ Slide

Key Insights:

• On Tuesday, bitcoin (BTC) slid by 1.33% to end the day at $16,720.
• Fed and recession jitters sent the NASDAQ Index and the crypto market into the red.
• The Fear & Greed Index rose from 27/100 to 28/100 despite the BTC pullback, suggesting investor resilience.

On Tuesday, bitcoin (BTC) fell by 1.33%. Reversing a 0.59% gain from Monday, BTC ended the day at $16,720. Notably, BTC failed to revisit $17,000 for the seventh consecutive session while seeing red for just the seventh time in ten sessions.

A choppy start to the day saw BTC rise to an early morning high of $16,987. However, coming up short of the First Major Resistance Level (R1) at $17,001, BTC slid to an early evening low of $16,617. BTC fell through the First Major Support Level (S1) at $16,852 and the Second Major Support Level (S2) at $16,759 to end the day at $16,720.

Fed and Recession Fear Sends the NASDAQ and BTC South

It was another quiet session on Tuesday. While the European and US markets reopened after the holidays, there were no economic indicators to influence market risk sentiment.

At the turn of the day, China’s plans to further ease COVID-19 restrictions and US holiday retail sales figures supported the bullish start to the session. The NASDAQ mini drove BTC to a session high before returning to the recent ranges.

However, a bearish afternoon left BTC in the red, with Fed and recession fears weighing on riskier assets.

Today, the US economic calendar is on the light side. Pending home sales figures for November are unlikely to influence, leaving the Fed and NASDAQ Index to guide investors.

However, investors should monitor the crypto news wires and consider any FOMC member chatter. Hawkish commentary would weigh on the broader crypto market.

On Tuesday, the NASDAQ Index fell by 1.38%, with the NASDAQ mini down 19 points this morning.

The Fear & Greed Index Rises from 27/100 to 28/100 Despite BTC Loss

Today, the BTC Fear & Greed Index rose from 27/100 to 28/100 despite a bearish BTC session. While ending the day in negative territory, BTC continued to avoid sub-$16,000.

With the European and US markets reopening, there was no holiday rally, with the NASDAQ Index and the broader crypto market seeing red. However, the Index reflected investor resilience, suggesting support on the downside over the near term.

Avoiding sub-20/100 remains the key near-term. The bulls will need to target the pre-FTX collapse November 6 high of 40/100 to support a BTC run at $20,000.

Bitcoin (BTC) Price Action

At the time of writing, BTC was down 0.02% to $16,716. A mixed start to the day saw BTC rise to an early high of $16,734 before falling to a low of $16,709.

Technical Indicators

BTC needs to move through the $16,775 pivot to target the First Major Resistance Level (R1) at $16,932. A return to $16,900 would signal a bullish session. However, the crypto news wires and the NASDAQ Index need to be crypto-friendly to support a breakout session.

In the event of an extended rally, BTC would test the Second Major Resistance Level (R2) at $17,145. The Third Major Resistance Level (R3) sits at $17,515.

Failure to move through the pivot would leave the First Major Support Level (S1) at $16,562 in play. Barring a crypto risk-off-fueled sell-off, BTC should avoid sub-$16,200. The Second Major Support Level (S2) at $16,405 should limit the downside. The Third Major Support Level (S3) sits at $16,035.

An adverse crypto market event would bring sub-$16,000 into play.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bearish signal. BTC sat below the 50-day EMA, currently at $16,856. The 50-day EMA fell back from the 100-day EMA, with the 100-day EMA pulling back from the 200-day EMA, delivering bearish signals.

A move through the 50-day EMA ($16,856) would support a breakout from the 100-day EMA ($16,914) and R1 ($16,932) to target the 200-day EMA ($17,076) and R2 ($17,145). However, failure to move through the 50-day EMA ($16,856) would bring the Major Support Levels into view.