BTC Fear & Greed Index Stays Neutral Signaling Further BTC Gains

Key Insights:

• It was a bearish Sunday, with BTC falling by 0.27% to end the day at $22,713.
• While easing FTX contagion risk supported another return to $23,000, the Genesis bankruptcy and Binance news weighed.
• The Fear & Greed Index fell from 53/100 to 50/100 but remained within the neutral zone.

On Sunday, bitcoin (BTC) fell by 0.27%. Partially reversing a 0.46% gain from Saturday, BTC ended the week up by 8.77% to $22,713. Notably, BTC revisited $23,000 for the second time since August.

After a range-bound morning, BTC rose to a mid-afternoon high of $23,072 before hitting reverse. Coming up short of the First Major Resistance Level (R1) at $23,276, BTC fell to a late low of $22,310. BTC briefly fell through the First Major Support Level (S1) at $22,350 before ending the day at $22,713.

The Genesis Bankruptcy and Binance News Tests Buyer Sentiment

It was a quiet Sunday session, with no external market forces to influence. However, the crypto news wires continued to provide direction, with Genesis and Binance in the spotlight.

Investor caution ahead of today’s first Genesis bankruptcy hearing pegged BTC back from a new 2023 high.

Binance was back in the news, with rumors of Signature Bank cutting SWIFT transfers testing buyer appetite. Clarification that Binance users can only transfer amounts of $100,000 or more eased market nerves.

However, hopes of an FTX revival continued to deliver BTC price support, though Fed fear and uncertainty toward the US economy remained crypto headwinds.

Today, updates from the first Genesis bankruptcy hearing and FTX news will be key drivers, with further updates on Binance also likely to influence. Net Genesis liability numbers will be the focal point as investors assess the possible fallout from a Genesis bankruptcy. However, there are no US economic indicators to provide direction.

While the BTC correlation with the NASDAQ Composite Index remains intact, the NASDAQ will likely play second fiddle to crypto-related news events.

The Fear & Greed Index Remains Neutral Despite a Bearish BTC

Today, the BTC Fear & Greed Index fell from 53/100 to 50/100. Despite the decline, the Index remained within the Neutral zone, supported by the BTC return to $23,000. Nonetheless, the second visit to $23,000 since August failed to drive the Index into the Greed zone.

Uncertainty toward the US economic outlook and Fed monetary policy has pegged the Index back. The Genesis bankruptcy is another near-term headwind, while progress toward an FTX revival should continue to provide support.

Near-term, the Index would need to return to the Greed zone (55/100) to support a BTC run at $25,000. The Index last visited the Greed zone in March 2022.

Bitcoin (BTC) Price Action

At the time of writing, BTC was up 0.37% to $22,797. A mixed start to the day saw BTC fall to an early low of $22,671 before rising to a high of $22,822.

Technical Indicators

BTC needs to avoid the $22,698 pivot to target the First Major Resistance Level (R1) at $23,087 and last week’s high of $23,353. A return to $23,000 would support a bullish session. However, the crypto news wires should be market-friendly to deliver a breakout.

In the event of another extended rally, BTC would likely test the Second Major Resistance Level (R2) at $23,460 and resistance at $23,500. The Third Major Resistance Level (R3) sits at $24,222.

A fall through the pivot would bring the First Major Support Level (S1) at $22,325 into play. Barring a broad-based crypto sell-off, BTC should avoid sub-$22,000 and the Second Major Support Level (S2) at $21,936. The Third Major Support Level (S3) sits at $21,174.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bullish signal. BTC sat above the 50-day EMA, currently at $21,432. The 50-day EMA pulled further away from the 200-day EMA, with the 100-day EMA widening from the 200-day EMA, delivering bullish signals.

A hold above the Major Support Levels and the 50-day EMA ($21,432) would support a breakout from R1 ($23,087) to target R2 ($23,460) and $23,500. However, a fall through S1 ($22,325) would give the bears a run at S2 ($21,936) and the 50-day EMA ($21,432). A fall through the 50-day EMA would signal a shift in sentiment.