Summary:

• Large-scale selling seen in Crytpocurrencies
• Bitcoin down more than 8% and under 4300
• ETHUSD has lost almost a third of its value since Friday

We earlier noted that there were significant declines seen over the weekend in the cryptocurrency space with comments from PBOC stating that initial coin offerings (ICOs) were illegal in China revealing a hostile view of the asset class from the world’s most populous country. 

A quick look at the 5 markets reveals something of a bloodbath. BTCUSD is down more than 8% but still fairing the best, with ETHUSD plummeting by almost 19% and LTCUSD having lost more than a fifth of its value just today. 

 There’s been major declines seen in cryptocurrencies today, with LTCUSD losing more than 20% of its value. Source: xStation

The question now for these markets is whether these declines are simply a pullback in the prevailing uptrend or the start of a deeper correction. First off lets look at Bitcoin, the most popular and widely viewed of all cryptos. The market has enjoyed an scarcely believable rally since making a low of 1850 back in mid-July. Price rallied up to 4866 last Friday, meaning a rise in excess of 150% in just a matter of weeks! A fib retracement of this move could provide possible levels to watch going forward with the 23.6% at 4154 now not far form being tested. The 61.8% level at 3000 could be especially key as this also coincided with a fairly big swing level. A break down below 3000 could be considered a major bearish development. 

 

 Bitcoin has enjoyed an incredible rally in the past 8 weeks. However, does today’s sell-off mark a turning point? Source: xStation

The next most popular cryptocurrency is Ethereum (ETHUSD) and this market has took a real beating in recent trade. There was a large gap lower over the weekend and today has seen a significant extension lower. Price has now fallen to its lowest level in several weeks after closing at a record high on Friday. Crucially from a technical perspective the market has also fallen below the 311 level which had previously been an important swing zone. 278 could now attract buyers back in but should this fail to hold then 246 takes on an even greater importance.

 ETHUSD is crashing with the market now almost 30% lower than Friday’s closing level. Source: xStation