ETH bleeds as India revisits the intended ban on cryptocurrencies
- Ethereum, alongside other cryptocurrencies, is bleeding due to the re-emergence of the crypto ban in India.
- If support at the 200 SMA fails to hold, Ether may extend the drop to $1,600.
- Holding above $1,700 and reclaiming the ground at $1,800 would keep the uptrend intact.
Ethereum has lost support at $1,800 and is currently hunting for another higher support, preferably above $1,700. The widespread declines come after reports emerged that the incoming ban on cryptocurrencies in India is meant to frustrate users.
India’s ban on cryptocurrencies becomes apparent
India has been considering banning cryptocurrencies from its economy for a while now. However, the government had not discussed the matter fully until reports surfaced, citing the finance minister for saying that a “calibrated” position will be taken on the topic.
One report on Reuters mentioned a senior government official who knew the new developments. The official outlined that India was contemplating banning cryptocurrency in almost all forms, such as holding, mining, and trading.
Ethereum freefall intensifies
Ethereum is almost testing the near-term support target at the 200 Simple Moving Average (SMA) on the 4-hour chart. Trading under this zone would be disastrous as it would trigger panic-selling among investors. Besides this support, the 100 SMA is in line to prevent losses from extending to $1,600.
Moreover, Ether has broken below the rising wedge pattern, hinting at a 24% downswing to $1,360. The Relative Strength Index has cemented the bearish outlook on the 4-hour chart.
ETH/USD 4-hour chart
Looking at the other side of the fence
Support at the 200 SMA will be instrumental in preventing the potentially massive declines to $1,360. Reclaiming the ground above $1,800 and the 50 SMA will bring Ether out of the woods and place it on the trajectory to all-time highs.