BTC Fear & Greed Index Holds Despite a NASDAQ Composite Index Fall

Key Insights:

• On Tuesday, bitcoin (BTC) slipped by 0.04% to end the day at $20,500.
• US economic indicators beat expectations to add more uncertainty ahead of today’s Fed monetary policy decision and press conference.
• The Bitcoin Fear & Greed Index held steady at 30/100 despite bearish BTC and NASDAQ Composite Index sessions.

On Tuesday, bitcoin (BTC) slipped by 0.04%. Following a 0.67% loss on Monday, BTC ended the day at $20,500. Notably, BTC wrapped up the day at $20,000 for the eighth consecutive session while avoiding sub-$20,000 for the seventh day in a row.

A bullish start to the day saw BTC rise to a late-morning high of $20,699. Falling short of the First Major Resistance Level (R1) at $20,827, BTC fell to an early afternoon low of $20,340. However, steering clear of the First Major Support Level (S1) at $20,224, BTC revisited $20,528 before falling back into the red.

US economic indicators tested buyer appetite for riskier assets.

In September, job openings increased from 10.280 million to 10.717 million, reflecting solid labor market conditions. The ISM Manufacturing PMI survey also reported improved labor market conditions. The ISM Manufacturing Employment Index rose from 48.7 to 50.0.

With the markets focusing on today’s FOMC monetary policy decision and press conference, the numbers delivered uncertainty over the Fed’s December plans. The NASDAQ Composite Index fell by 0.89%, with the S&P 500 falling by 0.41%.

Today, ADP nonfarm employment change numbers will provide further direction ahead of the main event. The FOMC interest rate decision and press conference will have a material impact on the US equity and crypto markets.

This morning, the FedWatch Tool had the probability of November and December rate hikes at 84.1% and 50.4%, respectively. One week ago, the likelihood of a 75-basis point hike in December stood at 50.8%.

BTC sensitivity to US economic indicators and the FED leaves the correlation with the NASDAQ Composite Index in place near term. This morning, the NASDAQ 100 Mini was up 4.25 points.

The Fear & Greed Index Holds Steady Ahead of Fed Policy Decision

This morning, the Fear & Greed Index held steady at 30/100. The Index avoided sub-30 despite the NASDAQ Composite Index falling for a second session. While falling short of $21,000, BTC continued to avoid sub-$20,000, suggesting a bottoming out.

However, today’s Fed policy decision and forward guidance will decide the Index path over the near term. Investors will hope for a Fed affirmation of a December Fed pivot that should support an Index return to the Neutral zone.

Today, US economic indicators will influence as investors await the Fed policy decision. Key stats include ADP nonfarm employment change numbers.

The Index will need to target 40/100 and the neutral zone to support a BTC bearish trend reversal. 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 down 0.18% to $20,463. A bearish start to the day saw BTC fall from an early high of $20,504 to a low of $20,430.

Technical Indicators

BTC needs to move through the $20,513 pivot to target the First Major Resistance Level (R1) at $20,686 and the Tuesday high of $20,699. A BTC return to $20,600 would signal a possible breakout session.

In the case of an extended rally, the Second Major Resistance Level (R2) at $21,872 and $21,000 would likely come into play. The Third Major Resistance Level (R3) sits at $21,231. BTC movement will hinge on US economic indicators and the FED.

Failure to move through the pivot would leave the First Major Support Level (S1) at $20,327 in play. Barring an extended sell-off, BTC should avoid sub-$20,000. The Second Major Support Level (S2) at $20,154 would limit the downside. However, a hawkish Fed would bring sub-$20,000 into view.

The Third Major Support Level (S3) sits at $19,795.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bullish signal. This morning, bitcoin sat above the 50-day EMA, currently at $20,368. The 50-day EMA widened from the 200-day EMA, with the 100-day EMA pulling away from the 200-day EMA to deliver bullish signals.

A hold above the 50-day EMA ($20,368) would support further upside and a return to $21,000. However, a fall through the 50-day EMA would bring the 100-day EMA ($20,072) into view. The 200-day EMA sits at $19,893.