BTC Fear & Greed Index Avoids Extreme Fear Despite a Bearish BTC

Bob Mason
Updated: Dec 4, 2022, 02:40 UTC

BTC led the broader crypto market into the red on Saturday, with economic and Fed monetary policy uncertainty and crypto headwinds testing sentiment.

BTC Tech Analysis - FX Empire

Key Insights:

  • On Saturday, bitcoin (BTC) fell by 1.18%. Reversing a 0.65% gain from Friday, BTC ended the day at sub-$17,000.
  • Friday’s US Jobs Report and US economic indicators from Thursday raised some uncertainty over Fed monetary policy, despite Powell’s talk of a Fed pivot.
  • The Fear & Greed Index slipped from 27/100 to 26/100, reflecting uncertainty from this week’s US stats.

On Saturday, bitcoin (BTC) fell by 1.18%. Reversing a 0.65% gain from Friday, BTC ended the day at $16,889. BTC visited $17,000 for the fourth consecutive day while wrapping up the day at sub-$17,000 for the second time in four sessions.

A bullish start to the day saw BTC rise to an early high of $17,144. Coming up short of the First Major Resistance Level (R1) at $17,197, BTC slid to a late low of $16,865. BTC briefly fell through the First Major Support Level (S1) at $16,886 before ending the day at $16,889.

Friday’s US Jobs Report continued to test investor sentiment on Saturday. The better-than-expected headline numbers raised question marks over the bets of a December Fed pivot. A contraction in the US manufacturing sector added to the bearish mood, though Fed Chair Powell’s talk about a Fed pivot cushioned the downside.

Crypto market headwinds, including FTX contagion, regulatory risk, and uncertainty toward the outcome of the SEC v Ripple case, likely influenced.

Today, crypto market news updates and the NASDAQ mini, in the final hour (UTC), will need monitoring. Following the NASDAQ Composite Index decline on Friday, a bearish start to the week could test investor resilience at current levels.

NASDAQ correlation
NASDAQ – BTCUSD 041222 Daily Chart

The Fear & Greed Index Falls to 26/100 on Bearish BTC Session

Today, the BTC Fear & Greed Index slipped from 27/100 to 26/100. Friday’s Jobs Report and the ISM Manufacturing PMI from Thursday continued to raise question marks over Fed monetary policy and the US economic outlook.

With crypto market headwinds lingering, the Index has struggled since the FTX collapse, reflecting investor uncertainty over regulations and any further FTX contagion.

However, hopes of a bottoming out have limited the downside, with the Index continuing to avoid sub-20/100.

Near-term, avoiding sub-20/100 remains the key near-term. The bulls will need to target the pre-FTX collapse November 6 high of 40/100 to support a BTC run at $20,000.

Fear & Greed Index avoids Extreme Fear.
Fear & Greed 041222

Bitcoin (BTC) Price Action

At the time of writing, BTC was up 0.41% to $16,958. A bullish start to the day saw BTC rise from an early low of $16,885 to a high of $17,073.

The First Major Resistance Level (R1) at $17,067 capped the upside.

BTC finds early interest.
BTCUSD 041222 Daily Chart

Technical Indicators

BTC needs to move through the $16,966 pivot to retarget the First Major Resistance Level (R1) at $17,067 and the Saturday high of $17,144. A move through the morning high of $17,073 would signal a bullish session. However, the crypto news wires should be market-friendly to support a breakout session.

In the event of an extended rally, BTC would likely test the Second Major Resistance Level (R2) at $17,245 and the current-week high of $17,335. The Third Major Resistance Level (R3) sits at $17,524.

Failure to move through the pivot would leave the First Major Support Level (S1) at $16,788 in play. Barring an extended sell-off, BTC should avoid sub-$16,500. The Second Major Support Level (S2) at $16,687 should limit the downside. The Third Major Support Level (S3) sits at $16,408.

BTC support levels in play below the pivot.
BTCUSD 041222 Hourly Chart

Looking at the EMAs and the 4-hourly candlestick chart (below), it was a more bullish signal. This morning, BTC sat above the 100-day EMA, currently at $16,871. The 50-day EMA closed in on the 100-day EMA, with the 100-day EMA narrowing to the 200-day EMA, delivering bullish signals.

A move through R1 ($17,067) would give the bulls a run at R2 ($17,245) and the 200-day EMA ($17,430). However, a fall through the 100-day EMA ($16,871) would bring the 50-day EMA ($16,792) and S1 ($16,788) into view. A fall through the 50-day EMA would signal an extended sell-off.

EMAs are more bullish.
BTCUSD 041222 4 Hourly Chart

About the Author

Bob Masonauthor

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.

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