It was a mixed session for BTC, which ended the day flat alongside the NASDAQ Composite Index, as investors look out for more fallout from FTX.
On Friday, bitcoin (BTC) rose by 0.01%. Following a 0.17% gain from Thursday, BTC ended the day at $16,685. Notably, BTC logged the fifth gain from thirteen sessions while falling short of $17,000 for the third time since 2020.
A bullish start to the day saw BTC rise to an early high of $16,977. BTC broke through the First Major Resistance Level (R1) at $16,809 and the Second Major Resistance Level (R2) at $16,934 before hitting the reverse.
The reversal saw BTC fall to a late afternoon low of $16,546. Steering clear of the First Major Support Level (S1) at $16,484, However, late crypto market support reversed losses from the session.
Regulatory chatter pegged BTC back from a return to $17,000. US, UK, and Australian regulators have been vocal since the collapse of FTX, raising the fear of draconian-style regulations.
The UK’s Financial Conduct Authority (FCA) proposed to ban crypto platforms this week.
While regulatory chatter drew interest, a quiet US economic calendar also left the NASDAQ Composite Index flat for the session.
Today, the Fear & Greed Index held steady at 23/100. While FTX contagion risk lingered, a lack of negative crypto market news left BTC and the Index flat for the session. It was also a quiet day on the US economic calendar, allowing investors to take a breather after the recent market turmoil.
BTC avoided sub-$16,000 for a fourth consecutive session, further supporting a possible price bottom. However, investor sentiment will likely remain FTX-linked contagion news dependent over the near term.
Barring adverse news, an Index return to the Fear zone would signal a BTC return to $20,000. However, the Index would need to avoid sub-20/100 to support an Index return to 40 and a move into the neutral zone. A fall to sub-20/100 would see BTC face the risk of sub-$10,000.
At the time of writing, BTC was down 0.09% to $16,670. A range-bound start to the day saw BTC rise to an early high of $16,688 before falling to a low of $16,668.
A move through the $16,736 pivot would target the First Major Resistance Level (R1) at $16,926 and the Friday high of $16,977. A breakout from R1 and a return to $17,000 would signal a bullish session.
In the event of an extended rally, BTC would likely test the Second Major Resistance Level (R2) at $17,167. Crypto news updates need to be BTC-friendly to support a return to $17,000.
The Third Major Resistance Level (R3) sits at $17,598.
A fall through the pivot would bring the First Major Support Level (S1) at $16,495 into play. Barring another extended sell-off, BTC should avoid sub-$16,000. The Second Major Support Level (S2) at $16,305 should limit the downside. However, negative FTX-related news could bring sub-$16,000 into play.
The Third Major Support Level (S3) sits at $15,874.
Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bearish signal. This morning, bitcoin sat below the 50-day EMA, currently at $17,057. The 50-day EMA pulled back from the 200-day EMA, with the 100-day EMA falling back from the 200-day EMA, delivering bearish signals.
A move through R1 ($16,926) would give the bulls a run at the 50-day EMA ($17,057) and R2 ($17,167). However, failure to move through the 50-day EMA would leave S1 ($16,495) in view.
With over 28 years of experience in the financial industry, Bob has worked with various global rating agencies and multinational banks. Currently he is covering currencies, commodities, alternative asset classes and global equities, focusing mostly on European and Asian markets.