Ethereum Faces 6-Month Low Against Bitcoin — Will ETH Price Retrace?
Ethereum’s native token, Ether (ETH), continues its multi-month downtrend against Bitcoin (BTC) in March, rising 5.5% against the latter’s 19.5% gains on a month-to-date timeframe.
Bitcoin overshadows Ethereum amid banking crisis
As of March 23, the ETH/BTC pair was down approx. 9% month to date to 0.0633 while staying on course to record its worst month since September 2022, when it fell 11.75%.
From a fundamental perspective, traders preferred Bitcoin over Ether, hoping that it would protect them from the ongoing banking turmoil in the US and other parts of the world. The narrative gained momentum in recent weeks as Wall Street investors such as Cathie Wood view Bitcoin as a potential “flight to safety” asset.
‼️CATHIE WOOD: #Bitcoinits response to the banking crisis is the most dramatic example of innovation solving problems. #Bitcoin was a flight to safety. pic.twitter.com/1lTD2Drto3
— Bitcoin Archive (@BTC_Archive) March 21, 2023
As a result of the rising speculation, Bitcoin outperformed traditional assets after March 8, when signs of trouble emerged at Silicon Valley Bank. In doing so, BTC also outperformed the altcoin market combined, including Ethereum.
ETH Paints Bullish Fractal Vs. BTC
But from a technical perspective, Ethereum is positioned for a comeback versus Bitcoin.
At least two technical indicators pose the possibility that ETH/BTC will rise sharply in the coming weeks.
Related: Ethereum price of $1.4K was a bargain, and a rally towards $2K looks like the next step
First, the pair’s three-day relative strength index has fallen below 30, which technical analysts consider an “oversold” area.
Second, Ether’s fall versus Bitcoin has landed its price near its rising support level (buy zone in the chart below).
A similar scenario in the June-July 2022 session preceded a roughly 60% rally against ETH/BTC’s descending trendline resistance (sell zone in the chart above). If the fractal plays out, the pair could rally towards the same resistance level by June 2023.
In other words, Ether has a decent chance to go back more than 15% to around 0.075 BTC. Conversely, a break below the rising trendline support will invalidate the bullish fractal.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
