Ethereum’s native token Ether (ETH) printed a death cross technical pattern against Bitcoin (BTC) for the first time since May 2022, suggesting more pain for ETH/BTC in the coming weeks.
Previous ETH Price Death Cross Preceded 27.5% Drop
A death cross occurs when an asset’s short-term 50-period moving average moves below its long-term 200-period moving average. This chart pattern was seen in December 2007, before the global economic crisis.
Similarly, the previous ETH/BTC death cross in May 2022 preceded a roughly 27.5% price correction, falling in parts as investors reduced exposure to altcoins and sought safety in Bitcoin in the midst of the collapse of Terra.
The latest ETH/BTC death cross could lead to a similar sell-off anytime soon, mainly due to the US Securities and Exchange Commission’s crackdown on cryptocurrency staking services. Staking is a key feature of many blockchains, including Ethereum.
Related: Why Bitcoin Price Rised Today?
Meanwhile, capital flows to and from Bitcoin and Ethereum-based funds also reveal that BTC is gaining ground. Interestingly, Bitcoin-based mutual funds have attracted $183 million in 2023 compared to Ethereum’s $15 million, according to CoinShares. latest weekly report.
Next targets for ETH/BTC
Potential next targets to watch for ETH/BTC are best seen on the weekly chart.
Namely, the 0.067-0.065 BTC area, which has served as a strong support level in recent history. A successful bounce here could see ETH price bounce towards its multi-month (black) downtrend line resistance near 0.075 BTC.
Conversely, a decisive break below the 0.067-0.065 BTC range could see ETH enter a sell-off towards the 200-week exponential moving average (200-week EMA; the blue wave) near 0.055 BTC, roughly a 20% below current price levels.
In particular, the 200-week EMA served as the bottom for the bear cycle from November 2021 to June 2022.
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.
