Key Findings:
- Bitcoin (BTC) rose for the seventh time in eight on Wednesday.
- Softer wholesale inflation numbers, a bullish NASDAQ 100 session and sentiment towards the merger and Vasil hard fork supported the broader crypto market.
- The Bitcoin Fear & Greed Index rose to 28/100 from 27/100, with a bullish BTC session supporting the modest surge.
Bitcoin (BTC) was up 0.29% on Wednesday. BTC partially reversed Tuesday’s 9.91% plunge to end the day at $20,234.
A bullish start to the day propelled BTC to an early high of $20,536. BTC missed the first major resistance level (R1) at $22,018 and slipped to a late afternoon low of $19,624. However, BTC avoided the first major support level (S1) at $19,107 and found late support to close the day at $20,234.
The August US Wholesale Inflation Report offered modest support. Softer numbers eased fears of a further rise in consumer price inflation. Notably, the stats lowered bets on a Fed rate hike by a percentage point.
On Wednesday, the NASDAQ 100 was up 0.74%, with the upside offering some consolation for the crypto market.
The US economic indicators are in focus again today. Retail sales, unemployment claims and Philly Fed Manufacturing numbers will attract interest. With the FOMC in its pre-meeting blackout period, markets remain data dependent. Gloomy consumption figures and a surge in jobless claims could increase bets on a 50 basis point rate hike.
NASDAQ – BTCUSD 150922 daily chart
Bitcoin Fear & Greed Index surges as BTC rallies below $20,000
Today the Fear & Greed Index went from 27/100 to 28/100. Although the rise was modest, the index avoided the extreme fear zone, reflecting investor resilience.
Easing bets on a 1 percentage point Fed rate hike and a bullish NASDAQ-100 session supported BTC and the index.
The bears will be eyeing a drop below 20/100 to signal a drop in BTC below $18,000. In contrast, BTC bulls will be looking for an index return to 40/100 to support a BTC move towards $25,000.
Bitcoin (BTC) price action
At the time of writing, BTC was down 0.38% to $20,158. A choppy start to the day saw BTC surge to an early high of $20,278 before falling to a low of $19,968.
BTCUSD 150922 daily chart
Technical indicators
BTC needs to avoid another decline through the $20,131 pivot to target the first major resistance level (R1) at $20,639. Crypto-friendly US economic indicators would support a breakout from Wednesday’s high of $20,536.
In the event of an extended rally, BTC should test the Second Major Resistance Level (R2) at $21,043. The third major resistance level (R3) is located at $21,955. While US stats will have an impact, the Ethereum merger needs to be smooth to support a bullish session.
A fall through the pivot would bring the First Major Support Level (S1) into play at $19,727. Barring a prolonged selloff, BTC should avoid going below $19,000. The second major support level (S2) at $19,219 should limit the downside.
The third major support level (S3) sits at $18,307.
BTCUSD 150922 hourly chart
Looking at the EMAs and the 4-hour candlestick chart (below), this was a bearish signal. Bitcoin was below the 100-day EMA this morning, currently at $20,730.
The 50-day EMA closed at the 100-day EMA, with the 100-day EMA declining against the 200-day EMA, providing bearish price signals. A bearish cross of the 50-day EMA through the 100-day EMA would support a slide below $19,000.
However, a BTC move through the 100-day EMA and 50-day EMA ($20,790) would give the bulls a run to R1 ($20,639). The 200-day EMA is at $21,090.
BTCUSD 150922 4 hour chart
trend analyses
Looking at the trends, BTC would need to clear the August highs of $25,203 and $25,500 to reach the June high of $31,956. Avoiding a decline through the September low of $18,549 would support a move back towards $25,000.
However, the current trend has turned bearish after Tuesday’s sell-off. A BTC drop through the September low of $18,549 would put below $18,000 and the June low of $17,601 into play.
BTCUSD 150922 Daily Chart Trends
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