Ethereum’s Loss Against Bitcoin Reaches 15 Months – Can ETH Price Reverse Course?
The price of Ethereum's native token Ether (ETH) is trading at a 15-month low against Bitcoin (BTC), and the lowest since Ethereum switched to proof-of-stake (PoS).
Will it continue to weaken for the rest of 2023? Let's take a closer look at the charts.
Ethereum price breaks below critical support against Bitcoin.
The ETH/BTC pair dropped to 0.056 BTC earlier this week. In doing so, the pair broke above the 200-week exponential moving average (200-week EMA, the blue wave) near 0.058 BTC, adding risks to the 2023 lows.
The 200-week EMA has historically served as a reliable support level for ETH/BTC bulls. For example, the pair recovered 75% three months after testing wave support in July 2022. Conversely, it has fallen more than 25% since losing the same support in October 2020.
ETH/BTC faces similar selling risks in 2023 after losing the 200-week EMA as support. In this case, the next lower target is the 0.5 Fib line near 0.051 BTC in 2023, a decrease of about 9.5% from the current price levels.
Conversely, if it takes the 200-week EMA as support, the price of ETH may rise to the 50-week EMA (red wave) near 0.065 BTC.
Bitcoin Bull Case Overshadows Ethereum.
Ethereum's persistent weakness against Bitcoin is reflected in institutional capital flow data.
For example, as of October 6, a Bitcoin-specific investment fund has attracted $246 million year-to-date (YTD), according to CoinShares. On the other hand, Ethereum funds have lost capital, witnessing an outflow of $104 million in the same period.
The difference may be due to growing buzz about the approval of a Bitcoin exchange-traded product (ETF) in the US.
Business analysts argue that the launch of a Bitcoin ETF somewhere will attract 600 billion dollars. Additionally, the fourth halving of Bitcoin on April 24, 2024 is acting like a tailwind to the altcoin market.
RELATED: Bitcoin Price Gets New $25K Target As SEC Raises GBTC Decision Day
The halving will reduce the block reward of Bitcoin miners from 6.25 BTC to 3.125 BTC, halving the new supply based on historical precedent.
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.
