Abstract：Investor sentiment improved this morning, with the Fear & Greed Index existing the Extreme Fear zone to suggest a bullish session for BTC and ETH.
Key Insights:
Bitcoin (BTC) and ethereum (ETH) saw red on Wednesday, though the losses were modest.
US economic indicators raised the bets of a 75-basis point Fed rate hike in November, leaving riskier assets on the defensive.
However, the technical indicators were bullish, with the EMAs for BTC and ETH supporting an upward move.
On Wednesday, bitcoin (BTC) fell by 0.92%. Partially reversing a 3.63% rally from Tuesday, BTC ended the day at $20,156. Notably, BTC held onto the $20,000 handle for the second time since September 17.
A mixed start to the day saw BTC strike an early high of $20,363. Coming up short of the First Major Resistance Level (R1) at $20,757, BTC slid to an early afternoon low of $19,750. However, coming within range of the First Major Support Level (S1) at $19,716, BTC bounced back to end the day at $20,156.
Ethereum (ETH) slipped by 0.66%. Partially reversing a 2.95% gain from Tuesday, ETH ended the day at $1,353.
Tracking the broader market, ETH rose to an early morning high of $1,365. Coming up short of the First Major Resistance Level (R1) at $1,382, ETH slid to an early afternoon low of $1,317. ETH fell through the First Major Support Level (S1) at $1,331 before a late partial recovery to end the day at $1,353.
Fed fear resurfaced on Wednesday, with better-than-expected US economic indicators testing investor appetite. However, while the probability of a 75-basis point Fed rate hike increased, investor fears of an economic recession abated to support the partial recovery.
Later today, US jobless claims and FOMC member chatter need consideration ahead of US nonfarm payrolls on Friday. While the BTC Fear & Greed Index exited the Extreme Fear zone today, we expect the NASDAQ 100 to influence.
Bitcoin (BTC) Price Action
At the time of writing, BTC was up 0.28% to $20,212.
A bullish start to the day saw BTC rise from an early low of $20,151 to a high of $20,455 before easing back. The First Major Resistance Level (R1) at $20,429 capped the upside early on.
Technical Indicators
BTC needs to avoid the $20,090 pivot to retarget the First Major Resistance Level (R1) at $20,429 and resistance at $21,000. A BTC move through $20,500 would signal a bullish session.
In the case of another extended rally, BTC should test the Second Major Resistance Level (R2) at $20,703 and resistance at $21,000. The Third Major Resistance Level (R3) sits at $21,316.
A fall through the pivot would bring the First Major Support Level (S1) at $19,816 into play. Barring an extended sell-off, BTC should avoid sub-$19,500 and the Second Major Support Level (S2) at $19,477. However, positive US weekly jobless claims figures and hawkish Fed chatter would pressure BTC later today.
The Third Major Support Level (S3) sits at $18,864.
Looking at the EMAs and the 4-hourly candlestick chart (below), it was a more bullish signal. This morning, bitcoin sat above the 200-day EMA, currently at $19,923.
After the 50-day EMA bullish cross through the 100-day EMA, the 50-day EMA pulled away from the 100-day EMA. The 100-day EMA narrowed to the 200-day EMA, delivering bullish price signals.
A bullish cross of the 50-day EMA through the 200-day EMA would support a breakout from R1 ($20,429) to target R2 ($20,703). However, a fall through the 200-day EMA ($19,923) would give the bears a run at S1 ($19,816), the 50-day ($19,677), and the 100-day ($19,624) EMAs.
Ethereum (ETH) Price Action
At the time of writing, ETH was up 0.99% to $1,366.
A bullish morning saw ETH rise from an early low of $1,352 to a high of $1,384. ETH broke through the First Major Resistance Level (R1) at $1,373 before easing back.
Technical Indicators
ETH needs to avoid the $1,345 pivot to retarget the First Major Resistance Level (R1) at $1,373. Crypto-friendly US economic indicators and FOMC member chatter would support a breakout from the morning high of $1,384.
In the event of an extended rally, the Second Major Resistance Level (R2) at $1,393 and $1,400 would likely come into play. The Third Major Resistance Level (R3) sits at $1,441.
A fall through the pivot would bring the First Major Support Level (S1) at $1,325 into play. Barring an extended US session sell-off, ETH should avoid sub-$1,300 and the Second Major Support Level (S2) at $1,297.
The Third Major Support Level (S3) sits at $1,249.
Looking at the EMAs and the 4-hourly candlestick chart (below), it was a more bullish signal. Ethereum sat above the 100-day EMA, currently at $1,360. 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.
An ETH hold above the 100-day EMA ($1,360) would support a breakout from R1 ($1,373) to bring R2 ($1,393) and $1,400 into view. However, a slide through the 100-day EMA ($1,360) and the 50-day EMA ($1,336) would give the bears a run at S1 ($1,325) and sub-$1,300. The 200-day EMA sits at $1,425.
