BTC Fear & Greed Index Slips Nearer to Fear on G20 News and Fed Fear

Key Insights:

• It was a bearish Saturday, with BTC falling by 0.09% to end the day at $23,178.
• Chatter from the G20 and further reaction to US inflation and hawkish Fed commentary left BTC in the red.
• The Fear & Greed Index responded to the threat of a more hawkish Fed policy outlook and anti-crypto sentiment, falling from 52/100 to 51/100.

On Saturday, bitcoin (BTC) slipped by 0.09%. Following a 3.13% slide on Friday, BTC ended the day at $23,178. The bearish session sent BTC to sub-$23,000 for the second time in ten sessions. BTC extended its losing streak to five sessions, the second of the year.

A mixed start to the day saw BTC rise to an early morning high of $23,223. Coming up short of the First Major Resistance Level (R1) at $23,942, BTC slid to a late low of $22,810. However, steering clear of the First Major Support Level (S1) at $22,665, BTC found late support to end the day at $23,178.

Anti-Crypto Sentiment from the G20 and Fed Fear Weighed

Updates from the G20 in India weighed on investor appetite on Saturday. While calls for a comprehensive global regulatory framework are nothing new, the talk of banning cryptos was bearish. The IMF maintained its anti-crypto stance, with IMF Managing Director Kristalina Georgieva suggesting that banning crypto should be an option.

The comments from the G20 came amidst increased regulatory scrutiny that weighed on investor sentiment in February.

Fed Fear added to the bearish mood on Saturday. Investors responded further to the latest US inflation numbers and hawkish Fed chatter that sent the NASDAQ Composite Index and the crypto market into the red on Friday.

The Day Ahead

Further updates from the G20 will likely draw interest. While the IMF floated the idea of a crypto ban, US Treasury Secretary Yellen poured water on a crypto ban but agreed on the need for a comprehensive crypto regulatory framework.

US regulatory activity and US lawmaker chatter will need continued monitoring. Investors should also track the crypto news wires for Binance and FTX updates and SEC v Ripple news that could move the dial.

In the final hour, the NASDAQ mini will likely provide direction as investors consider the impact of the latest US inflation numbers on Fed monetary policy.

The Fear & Greed Index Falls as the Bears Take the Reins

Today, the BTC Fear & Greed Index fell from 52/100 to 51/100. Significantly, the Index avoided a return to the Fear zone despite the IMF call for a ban on cryptos.

Fed Fear and the increasing regulatory scrutiny remain crypto headwinds that will continue to test investor sentiment.

After falling into the Neutral zone, the Index must return to the Greed zone to support a BTC breakout from $25,000 to target $30,000. However, an Index return to the Fear zone would signal a near-term bullish trend reversal.

Bitcoin (BTC) Price Action

This morning, BTC was down 0.25% to $23,119. A range-bound start to the day saw BTC fall from an early high of $23,179 to a low of $23,102.

Technical Indicators

BTC needs to avoid the $23,070 pivot to target the First Major Resistance Level (R1) at $23,331. A move through the Saturday high of $23,223 would signal a breakout session. The crypto news wires should be crypto-friendly to support an extended rally.

In the event of an extended rally, BTC would likely test the Second Major Resistance Level (R2) at $23,483 and resistance at $23,500. The Third Major Resistance Level (R3) sits at $23,896.

A fall through the pivot would bring the First Major Support Level (S1) at $22,918 into play. However, barring another Fed-fueled crypto sell-off, BTC should avoid sub-$22,500. The Second Major Support Level (S2) at $22,657 should limit the downside.

The Third Major Support Level (S3) sits at $22,244.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bearish signal. BTC sat below the 100-day EMA ($23,546). The 50-day EMA closed in on the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, delivering bearish signals.

A move through R1 ($23,331) would give the bulls a run at R2 ($23,483) and the 100-day ($23,546) and 50-day ($23,736) EMAs. However, a fall through S1 ($22,918) and the 200-day EMA ($22,853) would give the bears a run at S2 ($22,657). A move through the 50-day EMA ($23,736) would send a bullish signal.