Key Takeaways

China’s new crackdown on cryptocurrencies has wreaked havoc in the market.
Almost every single digital asset has suffered significant losses.
Huobi and OKEx’s tokens rank among the biggest losers in the recent flash crash.

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The utility tokens of cryptocurrency exchanges Huobi and OKEx have fallen significantly following China’s latest crackdown notice.

China Shakes the Crypto Market

The People’s Bank of China (PBOC) has strengthened its crackdown on cryptocurrencies, sending investors into fear. 

In the past few hours, more than $1.35 billion has been wiped out from the entire crypto market capitalization. The sudden sell-off generated nearly $450 million in liquidations worth of long and short positions across the board. 

Almost every single digital asset in the crypto space has suffered from the crash. Even the stablecoins USDT and USDC briefly dropped by approximately 0.20% from their $1 peg. 

Source: Coin360

The Huobi and OKEx’s tokens have taken the biggest hit from China’s latest crackdown, given their strong roots in the nation where they were founded. These digital assets saw their market valuation plunge by more than 22% within a few minutes and now stand on weak support. 

HT and OKB Crash in Tandem

The Fibonacci retracement indicator, measured from the Jul. 20 low of $7.40 to the Sep. 6 high of $17.70, reveals that Huobi Token sits on thin ice. The recent sell-off has pushed its price below the strong foothold at $11.30, and now the last line of defense for the bulls sits at $9.60. 

A candlestick close above this support level may relieve some of the selling pressure seen recently, leading to a rebound toward $11.30. But if bears manage to gain control of HT, triggering a close below $9.60, then a downswing to $7.40 seems imminent. 

Source: TradingView

OKB also slid through a significant support level at $15.42 due to the recent flash crash. Now, this utility token doesn’t have any demand barriers underneath it that can prevent it from dropping toward $12.80. 

Given the lack of support for OKB, it must keep trading above $12.80 so that a rebound to $15.42 can occur. Failing to hold above this critical support level might generate panic among traders, encouraging them to sell. Under such unique circumstances, OKB could fall to $9.50. 

Source: TradingView

Although some of the most renowned analysts in the cryptocurrency industry believe that the market will absorb the recent spike in downward pressure, it is crucial to pay close attention to the support levels previously mentioned. A daily close below $9.60 for HT and $12.80 for OKB could result in a steeper correction. 

This news was brought to you by Phemex, our preferred Derivatives Partner.

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