Prices of Ethereum's native nugget, Ether (ETH), slumped on Sept. 20 amid a wide sell-off in the cryptocurrency market, led by worries about a potential housing bubble crisis brewing in China.

The ETH/USD exchange rate dropped as much equally 12.52% to $2,911 on the Coinbase exchange, hit its everyman levels since the commencement of August. Elsewhere in the crypto market, Bitcoin (BTC), Binance Coin (BNB), Cardano (ADA), Solana (SOL) and other top tokens plunged in tandem.

The performance of top 10 crypto assets in the past 24 hours. Source: Messari

The drop imitated the mood in the broader market as United States equities plunged following a 24-hour interval of red in both the Asia-Pacific and European indexes. On the other hand, the U.South. dollar and regime bonds surged on haven-buying.

At the core of Monday'southward sell-off was a liquidity crisis at Chinese holding developer Evergrande. The world's most indebted property developer faces obligations of more $300 billion to creditors. That likewise includes a critical interest payment deadline on its offshore bonds, arriving on Sept. 23.

DW noted that if Evergrande topples, it could bring many banks down with it, aforementioned equally Lehman Brothers did during 2008's housing bubble crunch in the United States.

Although Ether does not merchandise in sync with global markets, its 30-day correlation with Bitcoin — the leading digital asset exposed to macroeconomic fundamentals — sits nearly 0.85. Equally a result, the altcoin appeared to accept faced an indirect consequence of China'due south looming housing crisis.

Bearish pattern triggered

The latest bout of selling in the Ether market place likewise triggered a classic surly pattern, which has a 75% accuracy when information technology comes to hitting its downside targets.

Dubbed a "double top," the blueprint develops after the price rallies strongly, pulls back, rises over again toward the previous peak and corrects all again — all while standing atop the so-called neckline support. Ultimately, the price falls beneath the neckline and targets levels located as deep equally the distance between the double tiptop'southward meridian and the neckline.

Ether appears to be halfway through while painting a double top pattern. The cryptocurrency'south chart below shows that it topped almost $4,385 on May 12, fell toward the neckline support of $1,984 and rose dorsum to some other sessional summit of $4,030 on Sept. 3.

ETH/USD weekly price chart. Source: TradingView

If the double top blueprint flourishes, ETH/USD rates could extend their ongoing sell-off toward $one,984 for a potential breakup move subsequently. Nonetheless, it does non wait feasible for ETH/USD to drop aggressively below the $1,984-neckline.

The level is besides near Ether's 50-calendar week exponential moving average (EMA) (the velvet wave) currently at $2,118, offering another support layer to safeguard Ether'south bullish bias. Earlier, the wave acted as an entrylevel for bulls following sharper ETH/USD pullbacks.

Related: Ethereum killers or just pretenders? But Ether remains king for now

At the same time, on a daily timeframe, the next back up line for Ether appears near its 200-mean solar day EMA (the orangish wave) at $2,536. Thus, a sharp pullback from the said level could negate the double superlative setup.

ETH/USD daily price chart featuring 200-day EMA support. Source: TradingView

Fundamentals

Ether continues to center adoption against Ethereum's function in backing the booming decentralized finance (DeFi) and nonfungible token (NFT) industry. In the recent SALT conference, Cathie Woods, CEO of Ark Invest, also said that investors should classify at least 40% of their crypto portfolios to Ether.

Excerpts from Wood's statement include:

"I'one thousand fascinated with what'due south going on in DeFi, which is collapsing the price of the infrastructure for fiscal services in a mode that I know that the traditional financial industry does not appreciate correct at present."

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