Ethereum, the third largest asset touched $124.48 low during early Asian hours before recovering to $134 by the time of writing. Should traders expect further decline? OctaFX shared the following ETHUSD technical analysis.
November 21, OctaFX – In January this year, all the cryptocurrencies tracked by CoinMarketCap had a market valuation of more than $800 billion. At the time, this valuation was larger than that of companies like Apple, Microsoft, and Amazon.
Cryptocurrency Decline Moves from Bad to Worse
In the months that followed, the crypto market valuation started to decline with regulatory issues being a major concern and countries like South Korea and Japan cracking down on ICOs and digital assets. Today, the total valuation of cryptocurrencies is just $146 billion. The market value of Bitcoin has dropped from a peak of $305 billion to the current $78 billion.
The main reason for the current drop is the loss of confidence among investors which started with the forking of Bitcoin Cash a week ago. Traders felt uncomfortable owning currencies whose value could be diluted with just a tweak in software.
What’s more, CoinMarketCap lists more than 2000 currencies, many of which are scams. While currencies like Bitcoin are currently being used online, their acceptance rate has been below par. Therefore, the price of crypto will likely continue moving lower as confidence continues to fall.
ETHUSD Technical Analysis
The ETHUSD pair reached a multi-monthly low of 119.14. This was the lowest level since last year. The market value of ETH has declined to $13 billion. On the four-hour chart below, the pair is now trading at 134.83.
The RSI has risen slightly from 8 to the current 29. The double EMAs show that the pair could continue to decline further. If it does, it will likely test the important psychologically level of 100.
This article was provided by OctaFX. It should NOT substitute for professional marketing consulting. Forex margin trading involves substantial risks. Forex margin trading exposes participants to risks including, but not limited to, changes in political conditions, economic factors, and other factors. All of which may substantially affect the price or availability of one or more foreign currencies.