Technical Analysis of ETH/USD for December 11, 2020

Crypto Industry News:

French financial authorities are strengthening national cryptocurrency laws to prevent illegal activities such as money laundering and terrorist financing. Yesterday, several ministries in France jointly issued an ordinance aimed at preventing anonymous transactions of digital assets by banning anonymous crypto accounts.

The new regulatory measures are supported by French Finance Minister Bruno Le Maire, Foreign Minister Sebastien Lecorn and Junior Economy Minister Olivier Dussopt. The order complies with Art. 203 of the French PACTE law, which stands for an action plan for the growth and transformation of business.

In the document, the ministries acknowledged that digital assets provide "significant economic opportunities", noting that the French government is fully aware of their importance.

Despite the promising opportunities, cryptocurrencies also carry significant risks from illegal financial activity, the authorities noted.

Ministers specifically referred to the arrests in September 2020 in which the terrorist financing network was using digital resources to cover its tracks. Major global authorities and organizations such as the Financial Action Task Force, G7 and G20 have called for measures to prevent illegal activity using cryptocurrencies. As such, the French government is preparing to introduce new regulatory provisions to apply new digital identification tools to crypto transactions and virtual asset service providers.

Technical Market Outlook:

The ETH/USD pair keeps moving lower in a corrective slide towards the level of $517.40, way below the key short-term technical support for the price seen at the level of $548.16. If the low is violated again, then the next important technical support is seen at $500. The momentum is now weak and negative, the price is still trading below the short-term trend line, so the corrective cycle still have a room to go lower. Please notice, the market is finally starting to come off the extremely overbought levels as well.

Weekly Pivot Points:

WR3 - $712.54

WR2 - $673.34

WR1 - $636.36

Weekly Pivot - $596.47

WS1 - $560.79

WS2 - $521.20

WS3 - $484.02

Trading Recommendations:

The up trend on the Ethereum continues and the next long term target for ETH/USD is seen at the level of $700, so any correction or local pull-back should be used to open the buy orders. Moreover, the bulls has hit the 38% Fibonacci retracement located at the level of $587.53 on the weekly time frame chart, but the current up trend is still valid. This scenario is valid as long as the level of $360 is broken.

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