Ethereum ‘dies a slow death’ as ETH breaks 8-year trend with Bitcoin
Ethereum's native token Ether (ETH) recently slipped below long-term support levels against Bitcoin (BTC), leading analysts to conclude that it is “dying a slow death.”
Once the 1,800% reset breaks the ether break that triggered it.
Specifically, the ETH/BTC pair broke below the upward trendline support associated with the market's highs since 2016.
That includes the pair's 300% recovery between December 2020 and December 2021 and an 1,800% recovery between January 2017 and May 2017.
ETH/BTC 6-Week Performance Chart. Source: TradingView
However, in November 2024, Ethereum bulls failed to defend the support, with ETH/BTC falling 15% below it, with increasing trading volume.
In technical analysis, the loss of a support level – especially during a period of increasing trading activity – indicates a strong selling pressure, which could cause ETH/BTC to fall further in the coming weeks.
“Ethereum is dying a slow death,” comments Tur Demeister, founder of Bitcoin hedge fund Adamant Capital.
Source: X.com/@TuurDemeester
In the year In 2024, ETH/BTC in particular underperformed largely due to the launch of a Bitcoin Exchange Traded Fund (ETF) in the United States and the underperformance of its own space, the Ethereum ETF.
This, coupled with Bitcoin's fourth halving in April, increased BTC's appeal among retail and institutional investors, resulting in capital shifting away from Ethereum and into Bitcoin.
Ether was hurt by the adoption of its top smart contract rival, Solana (SOL). For example, SOL/ETH has risen over 925% since December 2022.
SOL/ETH weekly price chart. Source: TradingView
Ethereum missed key headlines during Donald Trump's election campaign, in which he ignored Ethereum by flirting with the idea of Bitcoin becoming a strategic reserve asset in the US.
These factors have led to a sharp drop in Ethereum crypto market dominance (ETH.D), which is now at its lowest since April 2021.
ETH.D weekly performance chart. Source: TradingView
ETH price may drop another 50%
Chart technicians show that ETH/BTC has entered a breakout level into the existing inverse cup-and-hand (IC&H) pattern.
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The pattern is confirmed by a rounded top showing a loss of momentum at the top, followed by a slight upward consolidation, indicating a temporary pause or consolidation before resuming a downward move.
ETH/BTC weekly price chart. Source: TradingView
The IC&H pattern is resolved after the price breaks below their common neckline support and declines as much as the distance between the top of the cup and the neckline.
Applying this breakout scenario to the case of ETH/BTC brings a key support level between August 2019 and January 2020 to the 0.017 BTC minimum target for 2024. 50% off today's price.
Conversely, a strong recovery from the current support level to 0.0317 BTC—coinciding with the 0.786 Fib line could devalue the IC&H pattern, sending the pair to 0.043 BTC by the end of 2024.
This article does not contain investment advice or recommendations. Every investment and business activity involves risk, and readers should do their own research when making a decision.
