As a seasoned researcher with over two decades of experience in the crypto market, I must admit that the recent performance of Ether (ETH) against Bitcoin (BTC) has been quite disheartening. The breaking of the long-standing support level that once propelled a massive 1,800% rebound is a stark reminder of the volatile nature of this space.
As a crypto investor, I’ve noticed that the native token of Ethereum, Ether (ETH), has dipped beneath its longest-held support level in comparison to Bitcoin (BTC). This has prompted some leading analysts to predict a gradual demise for ETH, describing it as “slowly dying.
Ether breaks support that once prompted a 1,800% rebound
Significantly, the price of Ethereum relative to Bitcoin (ETH/BTC) dropped beneath a rising trendline that has lined up with its lowest points in the market since 2016.
In the span of a year, from December 2020 to December 2021, this pair experienced an impressive threefold increase in value. Similarly, within just four short months, between January 2017 and May 2017, it underwent a staggering 1,800% recovery. As an analyst, I find these remarkable growth patterns intriguing.
By November 2024, Ethereum supporters might have been unable to hold onto their support level. This resulted in a decline of approximately 15% for ETH/BTC, which was also accompanied by an increase in trading activity.
In the context of technical analysis, falling below a key support level during periods of heightened trading activity suggests significant selling force. This could potentially lead to a continued drop in the price of Ethereum relative to Bitcoin over the next few weeks.
According to Tuur Demeester, the founder of Bitcoin hedge fund Adamant Capital, Ethereum appears to be gradually fading away.
2024 saw ETH/BTC fall short primarily because of the introduction of U.S.-based Bitcoin spot exchange-traded funds (ETFs), which led to increased demand for Bitcoin, and the poor performance of Ethereum’s own spot ETF.
Due to the occurrence of Bitcoin’s fourth halving in April, its allure grew significantly among both individual and institutional investors, causing a significant movement of funds from Ethereum to Bitcoin.
Additionally, Ether faced challenges as Solana (SOL) gained popularity among its leading smart contract competitors. For example, the value of SOL/ETH increased more than 925% from December 2022 onwards.
During the time when Donald Trump was running for president, Ethereum was overlooked as Trump hinted at potentially designating Bitcoin as a strategic reserve asset within the U.S., effectively disregarding Ethereum.
The mentioned elements have caused a significant drop in the influence of Ethereum’s cryptocurrency market share (ETH.D), which is currently at its weakest point since April last year.
ETH price could drop another 50%
The chart analysis indicates that the Ethereum to Bitcoin ratio is moving towards the downward break of its current reversal pattern, which resembles an inverted cup-and-handle configuration.
The trend’s continuity is indicated by a peak shaped like a curve, which suggests a decrease in momentum during an upward trend, followed by a brief period of reduced activity moving sideways, indicating a short-term halt or consolidation before continuing the descent.
A chart pattern known as an IC&H (Inverted Cup and Handle) concludes when the price falls beneath the shared neckline support, potentially descending by approximately the same amount as the gap between the top of the cup and the neckline.
In simpler terms, if we apply this breakdown scenario to the comparison between Ethereum (ETH) and Bitcoin (BTC), it suggests that the potential lowest point for ETH in 2024 could be equivalent to just 0.017 BTC. This level was a significant support during the period from August 2019 to January 2020. This means that the price could drop by approximately 50% compared to its current levels.
As a researcher, I’ve identified a potential turning point at approximately 0.0317 BTC, which aligns with the 0.786 Fibonacci retracement level. If the market shows a robust recovery from this level, it might challenge and potentially invalidate the Inverse Head and Shoulders (IC&H) pattern we’ve been observing. If this happens, the price could surge towards around 0.043 BTC by the end of 2024.
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2024-11-16 16:37