Bitcoin Fear & Greed Index Tumbles Deep into the Fear Zone on BTC Slide

Key Insights:

• On Wednesday, bitcoin (BTC) extended the losing streak to four sessions, with a 2.19% fall to end the day at $23,333.
• With recession fears lingering, US economic indicators and the FOMC meeting minutes added to the market angst.
• The Bitcoin Fear & Greed Index slid from 41/100 to 30/100, signaling a deterioration in crypto investor sentiment.

On Wednesday, bitcoin (BTC) fell by 2.19%. Following a 1.60% decline on Tuesday, BTC ended the day at $23,333. Notably, BTC ended the day at sub-$24,000 for the second time in five sessions as BTC extended its losing streak to four. BTC also fell short of $25,000 for the second consecutive session.

A bullish start to the day saw BTC rise to an early high of $24,440. BTC broke through the First Major Resistance Level (R1) at $24,167 before sliding to a low of $23,170.

BTC fell through the First Major Support Level (S1) at $23,612 and the Second Major Support Level (S2) at $23,368 to end the day at $23,333.

There were no crypto news events to influence, leaving BTC and the broader market in the hands of market risk sentiment. US economic indicators and the US FOMC meeting minutes weighed on riskier assets. With recession fears lingering, US retail sales were flat in July.

The FOMC meeting minutes provided brief support before the markets considered the Fed’s rate path trajectory, which sent the NASDAQ 100 back into the red.

On Wednesday, the NASDAQ 100 fell by 1.25%, pressuring the crypto market late in the session.

Bitcoin Fear & Greed Index Tumbles Deep into the Fear Zone

Today, the Fear & Greed Index slid from 41/100 to 30/100. Another bitcoin sell-off and a failure to revisit $25,000 weighed on investor sentiment. Uncertainty over the global economic outlook and Fed monetary policy remain crypto headwinds.

Later today, Philly Fed Manufacturing and weekly jobless claims will provide further direction.

The Index needs to return to 40 to support a BTC return to $25,000. However, having failed to move into the Neutral zone for the first time since April 6, the latest slide puts the Extreme Fear zone in view.

Bitcoin (BTC) Price Action

At the time of writing, BTC was up 0.46% to $23,439.

Technical Indicators

BTC needs to move through the $23,648 pivot to target the First Major Resistance Level (R1) at $24,125 and the Tuesday high of $24,247.

BTC would need a bullish start to the session to support a return to $24,000.

An extended crypto rally would see BTC test the Second Major Resistance Level (R2) at $24,918 and resistance at $25,000. The Third Major Resistance Level (R3) sits at $26,188.

Failure to move through the pivot would bring the First Major Support Level (S1) at $22,855 into play. Barring an extended sell-off, BTC should steer clear of sub-$22,500 and the Second Major Support Level (S2) at $22,378.

The Third Major Support Level (S3) sits at $21,108.

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bearish signal. This morning, bitcoin sat above the 200-day EMA, currently at $23,249.

The 50-day EMA closed in on the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, delivering bearish price signals.

A move through the 100-day EMA (23,648) would bring the 50-day EMA ($23,894) and R1 ($24,125) into play.

However, a fall through the 200-day EMA would see BTC test S1 ($22,855) and support at $22,500.

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. A BTC move through the 100-day EMA and the 50-day EMA 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.