Originally published on: November 16, 2024
Ethereum’s native token, Ether (ETH), recently broke below its crucial support level against Bitcoin (BTC), signaling a concerning trend for the popular cryptocurrency. Top analysts are now raising alarms, suggesting that Ethereum may be on a downward trajectory.
The ETH/BTC pair recently slipped below the ascending trendline that has historically marked market bottoms for Ethereum since 2016. This trendline has been a reliable indicator of Ethereum’s performance against Bitcoin, with significant rebounds and recoveries in the past.
In November 2024, Ethereum bulls lost the battle to defend this support level, leading to a 15% drop in the ETH/BTC pair. This decline, accompanied by increased trading volumes, indicates strong selling pressure on Ethereum, which could result in further declines in the near future.
According to Tuur Demeester, founder of Bitcoin hedge fund Adamant Capital, Ethereum is “dying a slow death” as it struggles to compete with Bitcoin. The launch of spot Bitcoin exchange-traded funds (ETFs) in the US, coupled with Ethereum’s underperformance, has led to a capital shift towards Bitcoin, leaving Ethereum at a disadvantage.
Additionally, the rise of competitors like Solana (SOL) has further impacted Ethereum’s performance in the market. SOL/ETH has surged by over 925% since December 2022, highlighting the growing adoption of alternative smart contract platforms.
Technical analysis suggests that the ETH/BTC pair is entering a breakdown stage, following an inverse cup-and-handle pattern. This pattern typically leads to a significant decline in price, with a downside target of 0.017 BTC by the end of 2024, representing a 50% drop from current levels.
While these indicators may paint a grim picture for Ethereum, investors should conduct their own research and exercise caution when making investment decisions. The crypto market is highly volatile, and trends can change rapidly, making it essential to stay informed and adapt to market conditions.
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