Bitcoin Fear & Greed Index Avoids sub-40 as BTC Holds onto $24,000

Key Insights:

• On Monday, bitcoin (BTC) revisited $25,000 before a reversal left BTC in the red for the day.
• Risk aversion swept through the crypto market, with economic indicators from China driving a flight to safety.
• The BTC reversal from an August high of $25,203 weighed on the Bitcoin Fear & Greed Index, which slipped from 45/100 to 44/100.

On Monday, bitcoin (BTC) fell by 0.87%. Following a 0.56% decline from Sunday, BTC ended the day at $24,102. Notably, BTC visited $25,000 for the second time since June 13. However, BTC also fell to sub-$24,000 for the first time in three sessions.

A bullish start to the day saw BTC rise to an early high of $25,203. BTC broke through the First Major Resistance Level (R1) at $24,830 before sliding to a low of $23.783.

BTC fell through the First Major Support Level (S1) at $23,979 before a partial recovery to $24,102.

There were no crypto events to provide direction. The positive start to the Monday session was short-lived, with economic data from China weighing on demand for riskier assets. July numbers suggested that the global economy is not yet out of the woods.

Industrial production increased by 3.8% year-over-year, down from 3.9% in June. Retail sales increased by 2.7% year-over-year, down from 3.1% in June. Economists forecast industrial production of 4.6% and retail sales of 5.0%.

The NASDAQ 100 failed to deliver a rebound, with BTC extending losses after the US closing bell.

Bitcoin Fear & Greed Index Slips to 44/100 in Response to BTC Reversal

Today, the Fear & Greed Index slipped from 45/100 to 44/100. Despite a bearish start to the week and a BTC fall to sub-$24,000, the Index saw a modest pullback. While the economic data from China raised economic uncertainty, investors are hoping the Fed will take the foot off the gas in September.

A 50-basis point rate hike would support the crypto market. However, the threat of a 75-basis point rate hike remains, leaving the Index in the hands of US economic indicators and FOMC member chatter.

A return to $25,000 should support an Index move into the Neutral zone to give the BTC bulls a run at $30,000. The Index last visited the Neutral zone on April 6.

Bitcoin (BTC) Price Action

At the time of writing, BTC was down 0.37% to $24,014.

Technical Indicators

BTC needs to move through the $24,362 pivot to target the First Major Resistance Level (R1) at $24,941 and the Monday high of $25,203.

BTC would need a bullish start to the session to support a breakout from $24,500.

An extended crypto rally would see BTC test resistance at $25,500 and the Second Major Resistance Level (R2) at $25,783. The Third Major Resistance Level (R3) sits at $27,203.

Failure to move through the pivot would bring the First Major Support Level (S1) at $23,522 into play. Barring an extended sell-off, BTC should steer clear of sub-$23,500 and the Second Major Support Level (S2) at $22,943.

The Third Major Support Level (S3) sits at $21,523.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bullish signal. This morning, bitcoin sat at the 50-day EMA, currently at $24,009.

The 50-day EMA flattened on the 100-day EMA, while the 100-day EMA widened from the 200-day EMA, the signals price positive.

A breakout from the 50-day EMA would support a run at R1 ($24,941) to bring $25,000 back into play.

However, a fall through the 50-day EMA could see BTC test the 100-day EMA, currently at $23,643, and S1 ($23,522).

Trend Analysis

Looking at the trends, BTC would need a move through the August high of $25,203 and $25,500 to target the June high of $31,956. Avoiding a fall through the 50-day EMA, currently at $24,009, would support the current upward trend. From $32,000, BTC should have a clear run at the May high of $40,004.

For the bears, the June 18 low of $17,601 would be the next target, with a fall through $20,000 and the July low of $18,768 likely to test investor resilience.

However, as shown below, BTC is on a trend of higher lows, supporting a more bullish outlook.