Bitcoin tested resistance levels early today. A move through to $22,000 would support an extended rally through the afternoon session.
On Saturday, bitcoin (BTC) rose by 1.20%. Following a 0.57% gain on Friday, bitcoin ended the day at $21,474. Bitcoin logged a three-day winning streak for a second time this week.
A bullish start to the day saw bitcoin rise to a high of $21,587 before hitting reverse.
Coming within range of the First Major Resistance Level at $21,593, bitcoin slid to a low of $20,902.
Bitcoin found support at $21,000 to bounce back and end the day in positive territory.
A pickup in investor risk appetite delivered bitcoin with support on Saturday. On Friday, the NASDAQ 100 rallied by 3.34%, driving demand for cryptos.
We expect the correlation between the NASDAQ 100 and bitcoin to remain firmly in place on Monday.
This morning, the Fear & Greed Index held steady at 14/100.
While remaining deep within the “Extreme Fear” zone, the Index continued its recovery from a June 19 low of 6/100. At 14/100, the Index reflects investor fears of another bitcoin reversal, with resistance at $22,000 proving to be the key.
A bitcoin move through to 25/100 and into the “Fear Zone” would support a bitcoin run at $30,000. The Index last visited the “Fear Zone” on May 5.
Downside risks for bitcoin and the broader market remain, with Fed monetary policy, fears of a recession, and a likely shift in the regulatory landscape the current crypto headwinds.
At the time of writing, BTC was up by 0.95% to $21,679.
A mixed start to the day saw bitcoin fall to an early low of $21,276 before striking a high of $21,750.
Bitcoin came up against the First Major Resistance Level at $21,739 before easing back.
Avoiding the $21,320 pivot would leave the First Major Resistance Level at $21,739 in play.
BTC would need plenty of support to avoid a fallback to sub-$21,500.
An extended rally would test the Second Major Resistance Level at $22,007 and resistance at $22,500. The Third Major Resistance Level sits at $22,691.
A fall through the pivot would bring the First Major Support Level at $21,054 into play. In case of another extended sell-off, bitcoin could test the Second Major Support Level at $20,636 and support at $20,500.
The Third Major Support Level sits at $19,951.
Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bearish signal. This morning, bitcoin sat above the 50-day EMA, currently at $21,262.
The 50-day EMA narrowed to the 100-day EMA. The 100-day EMA eased back from the 100-day EMA, bitcoin price negative.
A return to $22,000 would bring the 100-day EMA, currently at $22,653, into play.
In case of a fall through the 50-day EMA, bitcoin would test the Major Support Levels.
With over 20 years of experience in the finance industry, Bob has been managing regional teams across Europe and Asia and focusing on analytics across both corporate and financial institutions. Currently he is covering developments relating to the financial markets, including currencies, commodities, alternative asset classes, and global equities.