BTC Fear & Greed Index Holds Despite BTC Loss and Hawkish Fed Bets

Key Insights:

• On Friday, bitcoin (BTC) resumed its downward trend, falling by 1.03% to $19,186.
• US economic indicators sent riskier assets into the red, as the markets locked in a 75-basis point rate hike in November.
• The Bitcoin Fear & Greed Index held steady at 24/100.

On Friday, bitcoin (BTC) fell by 1.03%. Reversing a 1.17% gain from Thursday, BTC ended the day at $19,186. Notably, BTC fell short of $20,000 for the seventh consecutive session while avoiding sub-$19,000.

A bullish start to the day saw BTC rally to an early morning high of $19,944. BTC broke through the First Major Resistance Level (R1) at $19,880 before sliding to a late low of $19,088. However, steering clear of the First Major Support Level (S1) at $18,526, BTC revisited $19,193 before easing back.

US economic indicators and the NASDAQ 100 sent BTC into an afternoon session reversal. Following Thursday’s bearish US CPI report, retail sales and consumer sentiment weighed on risk appetite.

In September, core retail sales increased by 0.1%, with retail sales holding steady despite the rise in interest rates, persistent inflation, and economic uncertainty.

Later in the session, the Michigan Consumer Sentiment Index increased from 58.6 to 59.8, while the Expectations Index slipped from 58.0 to 56.2. Notably, long-run inflation expectations returned to 2.9% after falling below the 2.9% – 3.1% range in September for the first time since July 2021.

The stats led to the markets locking in a 75-basis point rate hike in November and raising the prospects of a 75-basis point hike in December.

According to the FedWatch Tool, the probabilities of 75 basis point Fed rate hikes in November and December stand at 99.4% and 66.7%, respectively. One week earlier, the chances of 75-basis point hikes were 81.1% and 23.4%, respectively.

In response to the US economic indicators and Fed sentiment, the NASDAQ 100 tumbled by 3.08%.

The Fear & Greed Index Holds Steady as BTC Avoids Sub-$19,000

Today, the Fear & Greed Index held steady at 24/100. A bearish BTC session failed to send the Index to sub-20, providing further evidence of a BTC bottoming out. On Friday, BTC avoided a return to sub-$19,000 despite the increased bets of hawkish Fed moves in November and December.

Avoiding sub-20/100 amidst rising bets of 75-basis point Fed rate hikes in November and December further supported those eying a market bottom.

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 0.16% to $19,217. A bullish start to the day saw BTC rise from an early low of $19,178 to a high of $19,227.

Technical Indicators

BTC needs to move through the $19,406 pivot to target the First Major Resistance Level (R1) at $19,724 and the Friday high of $19,944. A BTC return to $19,500 would signal a bullish session. However, following the US economic indicators from the week, crypto news would have to deliver support.

In the case of an extended rally, the Second Major Resistance Level (R2) at $20,262 and resistance at $20,500 would likely cap the upside. The Third Major Resistance Level (R3) sits at $21,118.

Failure to move through the pivot would leave the First Major Support Level (S1) at $18,868 in play. Barring another extended sell-off, the Second Major Support Level (S2) at $18,550 should limit the downside.

The Third Major Support Level (S3) sits at $17,694.

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 $19,353. The 50-day EMA fell back from the 100-day EMA, with the 100-day EMA easing back from the 200-day EMA to deliver bearish signals.

BTC needs to move through the EMAs to target R1 ($19,724) and support a return to $20,000. However, a failure to move through the 50-day EMA ($19,353) would give the bears a run at S1 ($18,868). The 200-day EMA sits at $19,699.