18.05.202108:42 Forex Analysis & Reviews: Technical Analysis of ETH/USD for May 18, 2021

Crypto Industry News:

According to a new report, the Iranian government continues to closely monitor the cryptocurrency mining industry, initiating new measures against domestic cryptocurrency miners.

Mostafa Rajabi, a spokesman for the Iranian Ministry of Energy, said mining cryptocurrencies using household electricity is not legal and therefore such miners will face heavy fines, a local news agency said.

Household energy cryptocurrency miners will also be required to compensate for potential damage to the electricity grid, the official said.

Rajabi said the government has taken these steps to deal with Iran's energy shortage - as a result of foreign sanctions on hydrocarbons and reduced hydropower production due to less than average rainfall.

Rajabi stated that unauthorized mining of cryptocurrencies could damage the local power grid and lead to power outages. He said last week that as much as 87% of cryptocurrency mining operations in Iran are illegal.

The energy crisis in Iran has prompted the government to tightly control the energy-intensive industry. In 2018, Iran's Supreme Council Secretary for Cyberspace said that Iran's various government ministries had approved mining as an industry. Ultimately, the Iranian government approved cryptocurrency mining as an industrial activity in 2019, subjecting it to a licensing system and a regulated electricity price system.

In April, the central bank authorized banks and licensed foreign exchange stores to use cryptocurrency as payment for imports in order to mitigate the effects of sanctions imposed by the United States.

Technical Market Outlook:

The ETH/USD pair has made another wave down to the level of $3,122 and bounced towards the immediate technical resistance is seen at the level of $3,489, $3,552 and $3,596. The zone located between the levels of $3,184 - $3,000 is the key short-term demand zone and any violation of this zone will lead to another wave down towards the level of $2,955 and $2,757. The market is in full control of bears and only a strong breakout above the level of $3,623 (38% Fibonacci retracement of the last wave down) would temporary change the outlook to bullish (but still corrective in nature).

Weekly Pivot Points:

WR3 - $4,859

WR2 - $4,608

WR1 - $3,835

Weekly Pivot - $3,623

WS1 - $2,857

WS2 - $2,581

WS3 - $1,823

Trading Recommendations:

The longer term up trend on the Ethereum continues despite the local counter-trend corrections. The next long term target for ETH/USD is seen at the level of $5,000. The key long term technical support is seen at the level of $3,000, so only a weekly candle close below this level will invalidate the bullish scenario.