FX.co ★ Technical Analysis of ETH/USD for February 23, 2022

Crypto Industry News:

The Ministry of Energy of the Republic of Kazakhstan has announced that it has detected and terminated 13 cryptocurrency mining operations. The government has made closings as part of efforts to regulate Bitcoin's mining sector, which has become increasingly popular in recent years.

According to the official statement, the miners used a total of 202 megawatts. According to the Kazakh government, work on identifying and disconnecting mining farms from electricity networks will continue. Once illegal mining operations are detected, authorized authorities will undertake operational and investigative measures.

After the cryptocurrency industry was suppressed in China, Kazakhstan became the world's second largest producer of Bitcoin, which was associated with rapid energy consumption. Kazakhstan was the place where the 18% global bitcoin hash rate was generated as of August 2021. In April, before Chinese mining restrictions, the figure was only 8%.

In June 2021, the President of Kazakhstan approved the creation of a tax category for Bitcoin mining, which could have been motivated by China's anti-bitcoin attitude. In 2021, due to hostility from the authorities, Chinese BTC mining companies such as Canaan and BTC.com moved to Kazakhstan.

While the mining industry has been largely concentrated in the country for a while, it looks like it will lose its share of the hash rate for various reasons, according to several sector executives. Most likely, this would cause Kazakhstan to leave the podium of the three largest BTC mining countries in the index update expected next month.

Technical Market Outlook

The ETH/USD pair has bounced from the local low and is testing the lower descending channel line around the level of $2,700. The market bounced from the oversold conditions, however the down move will likely be continued soon. The nearest technical resistance is located at the level of $2,740 and $2,695. Despite the oversold market conditions, the momentum remains weak and negative, which support the short-term bearish outlook for ETH.

Weekly Pivot Points:

WR3 - $3,521

WR2 - $3,347

WR1 - $2,888

Weekly Pivot - $2,742

WS1 - $2,272

WS2 - $2,129

WS3 - $1,665

Trading Outlook:

The market is bouncing after over the 50% retracement made since the ATH at the level of $4,868 was made. The level of $3,436 is the next key technical resistance for bulls. On the other hand, the next long-term technical support is located at $1,721 (61% Fibonacci retracement of the last big impulsive wave up) is still the key long-term.