The cryptocurrency atmosphere took a huge hit last weekend when all the coins, except for a couple, crashed heavily into their respective supports and everyone was left hanging why. The whole marketplace was shaken by a since-deleted tweet by a user under the handle of “@FXhedgers”. The tweet speculated that the US Treasury was looking to charge several financial institutions with money laundering through cryptocurrencies.
This isn’t really true as the US Treasury does have the authority to do so, only the Department of Justice. However, when you couple this rumor with the fact that Turkey banned crypto payments in the preceding week, it was enough to stoke a broad sell-off in the market.
This sell-off was exasperated by the ETF situation, Bitcoin was able to sell off so quickly because many wanna-be buyers rely on access to the instrument through ETF products, like the Grayscale Bitcoin Trust (GBTC).
We saw how bitcoin was smashed down towards the $51,300 support level, twice in a week. The first one was on Sunday as previously mentioned, while the other happened during today’s trading on the Asian session. The fear of more downside pressure is building with market participants as they try their hardest to stay above the $53,500 support level.
While bitcoin appears in a battle between Bulls and Bears to see who will lead the instrument in the next leg, Ethereum (ETH) was able to initially shrug off the negative momentum around the $2,000 level and moved back higher towards the $2,480. The instrument then reached a high of $2,650 before being rejected again back to the $2100 support. Ethereum is now consolidating in the $2150-2400 region before its next move.
Of course, Litecoin (LTC) was not spared from the crash in the crypto market and fell from the highs of $340 towards the 100-SMA (Simple Moving Average) on the 4-hour chart. This move was then consolidated, as the instrument traded between the 100-SMA and 50-SMA forming the lower and higher barriers, respectively, to the consolidation zone. LTC then broke down below the 100-SMA amidst a further dip in the cryptocurrency market, and is currently consolidating in the $215-245 zone.
(Note: The above Market Brief covers the wider VA industry, and may not be an activity that Arabian Bourse Limited (ABX) is looking to be licensed to undertake.
ABX has received in-principal approval from Financial Services Regulatory Authority of Abu Dhabi Global Market (ADGM) and is currently in the process of obtaining an FSP. ABX aims to be the first of its kind fully regulated, virtual asset MTF and custodian in the region focused on institutional and retail investors.)