The United States Securities and Exchange Commission (SEC) halted the recovery in the cryptocurrency markets in its tracks. It started with the crackdown on crypto exchange Kraken. On Feb. 9, The SEC announced that Kraken had reached an agreement to pay a $30 million fine and stop its cryptocurrency staking operation for US investors.
Even as crypto investors were digesting this news, the regulators struck another blow, this time to blockchain company Paxos Trust. The SEC issued a wells notice, a notification from the regulator to the recipient about the planned enforcement action against them, to Paxos, alleging that the dollar-pegged Binance USD is an unregistered security.
We had cautioned in our previous analysis that if the 20-day exponential moving average (EMA) cracks, Bitcoin could plunge to $21,500 and that is what happened. Buyers have successfully defended the $21,500 level since February 10 but the weak bounce shows that bears are maintaining their selling pressure.
The 20-day EMA has started to turn down and the relative strength index (RSI) has slipped into the negative territory, indicating that bears have a slight edge. If the price breaks and closes below $21,500, the BTC/USD pair could plummet to the 50- day simple moving average (SMA).
The zone between $21,500 and the 50-day SMA is likely to attract aggressive buying by the bulls. However, the bears are unlikely to give up easily and will try to stall the relief rallies near the 20-day EMA. The selling may intensify if the 50-day SMA breaks down and the pair could nosedive to the next support at $18,385. Contrary to this assumption, if the price turns up from the current level and rises above the 20-day EMA, it will suggest that bulls have flipped the $21,500 level into support.
That will increase the possibility of a rally to $23,500 and then to $24,000.
Lastly please check out the advancement’s happening in the cryptocurrency world.
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