Ether (ETH) entered a strong price rally one week after hitting a six-month low against Bitcoin (BTC).
On April 18, the widely tracked ETH/BTC pair hit 0.0709 BTC, up 15% from its local low of 0.0602 BTC six days ago. Now, the pair envisions a move towards 0.075 BTC by June, based on the fractal setup discussed earlier here.
Ethereum Shapella FOMO
Interestingly, the local bottom formation of Ether against Bitcoin occurred on Ethereum day. the long-awaited updates to Shapella.
The hard fork allows Ether participants to withdraw their rewards (around 1.1 billion ETH) from the Ethereum proof-of-stake smart contract. This upgrade may have increased the attractiveness of ETH compared to BTC, exceeding expectations for a newly unlocked Ether supply. Selling pressure would increase.
Participants have withdrawn 574,700 ETH, worth approximately $1.21 billion, since the Shapella updates on April 12, according to data compiled by Nansen. Interestingly, the price of Ether in US dollars has increased by 14.25% in the same period.
It means that many participants have decided to keep their Ether rewards. On the other hand, Bitcoin failed to make a decisive break above its $30,000 technical resistance, possibly making ETH a more attractive short-term bet for traders.
Weak institutional entries against Bitcoin
Institutional investors have shown more interest in Bitcoin than Ether in the past week, according to the weekly CoinShares report.
For example, Bitcoin-based investment vehicles saw inflows of $103.8 million in the week ending April 14. By comparison, Ethereum funds attracted $300,000, showing that major investors may have followed the “sell the news” strategy after the Shapella updates.
Meanwhile, the Ether price is also at risk of a potential bearish reversal move due to its overbought daily Relative Strength Index.
Related: Shapella Could Attract Institutional Investors To Ethereum Despite Risks
If ETH price pulls back from its current resistance level of around $2,140, its immediate downside target appears at around $1,984, which acted as resistance in May 2022 and August 2022.
A prolonged sell-off could push the price of Ether back to its 50-day exponential moving average (50-day EMA; the red wave) near $1,800, roughly 15% below its current price levels.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should do their own research when making a decision.
