Following a crucial week for Ethereum, there is a technical candlestick arrangement that indicates a possible sharp upturn in ETH prices in the upcoming weeks and months. One analyst pointed out events in the monthly chart where the ETH/BTC ratio reversed from a multi-year support trend line. This is significant because altcoin prices typically react when prices bounce from this line and trend higher.
Analysts closely monitor the ETH/BTC ratio, which compares the performance of the world’s top two most valuable coins. Despite Bitcoin’s firm stance over the last two years, the monthly chart reveals a descending channel signaling an upward trend. The series of higher lows suggests that bulls have absorbed selling pressure over the years, keeping prices elevated. The monthly bar is expected to close firmly as bullish, resulting in a double-bar bullish reversal pattern that could spark demand and push ETH prices even higher.
Volume and Performance Comparison
Despite the positive indicators, the relatively lower trading volume compared to July 2022 suggests that participation levels are not as high historically. A bullish bar in June confirming this month’s gain could set the stage for further gains, similar to those observed in January 2021. A potential 40% gain versus Bitcoin could see ETH closing above 0.08 BTC, nearing 2017 highs.
Bitcoin’s Dominance and ETH’s Potential
Bitcoin has been dominating the market, outperforming ETH since September 2022, erasing gains from the previous years. This trend has created a descending channel, but with low participation levels. Despite this, a close above 0.08 BTC would signal bullish momentum for ETH and could potentially establish a foundation for narrowing BTC’s dominance.
Over the years, BTC has been the only digital asset recognized by the United States Securities and Exchange Commission (SEC), making it the preferred asset for institutional investors. The recent approval of listing spot Ethereum ETFs by the SEC represents a significant shift. This move has boosted ETH prices by as much as 30%, outperforming Bitcoin and potentially leading to further price increases in the future.
The technical analysis and market developments suggest a potential upturn in Ethereum prices in the coming weeks. The approval of spot Ethereum ETFs by the SEC and the positive indicators from the monthly chart could fuel demand and push ETH prices higher, possibly narrowing Bitcoin’s dominance in the market. Investors and traders should closely monitor these developments to capitalize on potential gains in the cryptocurrency market.
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