Bitcoin, ethereum and other cryptocurrencies are getting rocked on Friday.
Considered two leaders in the space, these cryptos are down 6% and 8%, respectively.
That’s better than where these names were trading earlier in the day. Bitcoin was down 9.4% at its lows, while Ethereum was down more than 13%.
Hitting the group is China’s blanket ban on cryptocurrency trading.
Unfortunately for bulls, it has been a rough ride. For ethereum, it was the crypto’s second daily loss of more than 10% this week.
If the bulls have any luck, though, ethereum will avoid a double-digit percentage loss on Friday.
This isn’t the first time that a negative headline from China sent a ripple through the cryptocurrency market and it probably won’t be the last.
It hits stocks, too, like Coinbase (COIN) , Robinhood (HOOD) – Get Robinhood Report, Square (SQ) – Get Square, Inc. Class A Report, Microstrategy (MSTR) – Get MicroStrategy Incorporated Class A Report and others.
Let’s look at the charts.
Like bitcoin, ethereum is doing a good job holding the weekly low.
Tell that to a bull who’s already long, though, and that trader may not find much consolation in that.
After all, ethereum has fallen in six of the past nine days. Further, it’s down for its third straight week and for the fifth week in the past six. From the recent high to this morning’s low, Ethereum is down more than 34%.
In other words, it hasn’t been a fun or easy ride, even though it’s still up massively — 68.6% — from the July low.
That said, ethereum is in a weird spot. It’s below the 10-day, 21-day, 50-day and 10-week moving averages, as well as the key $2,900 to $3,000 zone.
However, it’s above some of its longer-term moving averages, like the 21-week and 200-day measures. In other words, its short- and intermediate-term trends are clashing with the longer-term trend.
From here, it’s pretty nimble trading — and too choppy for many investors — until ethereum resolves one way or the other.
A move above $3,000 opens the door to the 10-week moving average and this week’s high at $3,178. Above that puts the 50-day moving average in play, followed by a potential rally to the $3,500 to $3,675 area.
On the downside, a break of the 21-week moving average leaves this week’s low vulnerable. That’s down near $2,650.
The only silver lining here would be a break of this week’s low and a test of the 200-day moving average, met by a strong bounce afterward.
I know that’s not what bulls want to hear, but it’s true.
A larger move below the 200-day moving average puts the $2,325 to $2,450 area in play. That could be followed by a test of the $2,000 area and the 50-week moving average, but let’s not get ahead of ourselves.
For now, keep an eye on the 21-week moving average, followed by $2,650. On the upside, watch $3,000.