By Samuel Indyk
Investing.com – Bitcoin is trading lower on Tuesday but remains resilient above $40,000 despite the recent negative headlines on regulation emanating from China.
On Friday, the People’s Bank of China announced it had banned all cryptocurrency transactions and promised to stamp out mining after previously announcing measures earlier this year. The crackdown has led to exchanges taking measures to stop mainland Chinese account sign-ups, while Huobi announced it would end contracts with mainland China clients by the end of the year.
The news has pressured Bitcoin but maybe not as much as expected with the price holding firm above $40,000, although still well below its all-time high near $65,000.
In fact, some Chinese investors have doubled down on cryptocurrencies since the latest Chinese measures.
“I have bought some when it dipped,” Ballet Global Chief Executive Bobby Lee told Bloomberg, adding that the China crackdown has not been as bad as many had thought.
Bitcoin Technical Picture
Bitcoin is currently trading around $42,000 and is holding above its 100-day moving average around $41,130. A break below there would target the psychological $40,000 level.
To the upside, $44,000 appears to be strong resistance, while above that level the 200-day moving average resides around $45,400.
But for now, the world’s largest cryptocurrency remains rangebound between $40,000-$45,000.
“A breakout in either direction will be significant,” writes OANDA Senior Market Analyst Craig Erlam in an emailed note.
“It has appeared to be heading for a correction for weeks now and the break lower last Tuesday looked to be the catalyst but once again, it has found strong support.
“A move below $40,000 would be a psychological blow, while the technicals wouldn't look great in the near-term.”
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