Bitcoin : #Price #Analysis, September 25. #China has banned #ICOs and has ended cryptocurrency #trading opportunities on the #Chinese exchanges. However, it is moving ahead with steps to study the #Blockchain #technology in detail to issue its own digital #currency.
Beijing should “accelerate the process of launching a sovereign digital currency after it curbed risks of cryptocurrencies,” said an opinion piece published in the Financial #News, the mouthpiece of the #People’s #Bank of China(PBOC).
However, with credit rating agencies recently downgrading China’s sovereign rating, it is unlikely that a digital currency issued by the PBOC will displace #Bitcoin or #Ethereum.
#BTC / #USD
Bitcoin has been trading in a small range for the past two days. It is facing resistance at the 3,800 levels. Today, even if the digital currency breaks out of the downtrend line, it is unlikely to race away towards the highs. It will face resistance from the 20-day exponential moving average (EMA) at $3,886. Thereafter, the next resistance zone is between $4,050 and $4,120 levels. Unless Bitcoin breaks out of this, it is likely to remain range-bound and volatile. Nevertheless, a breakout of the downtrend line will change the trend from down to range bound.
On the downside, the digital currency has a strong support at $3,500 levels. A breakdown of this level can push the #cryptocurrency back towards the lows of $2,974.
Currently, we don’t find a #buy setup with a good risk to reward ratio. Nevertheless, aggressive traders can look for buying opportunities once Bitcoin #breaks out and closes above the downtrend line. The initial stop loss can be kept at 3,500, which can be raised later. The position size shouldn’t be more than 25 percent of the #normal.
If #Bitcoin gains momentum, additional positions can be added above $4,120 #levels. The first target objective on the upside is $4,680, above which a retest of the lifetime highs is likely.