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Bitcoin prices have underperformed Ether in the weeks leading up to “The Merge.”
Dreamstime
Bitcoin
was largely unchanged on Thursday, with attention in the cryptocurrency world right on
Ethereum
after the blockchain network’s long-awaited fundamental upgrade known as Merge.
The price of Bitcoin has fallen 1% over the past 24 hours to $20,100 – staying above the key $20,000 level and remaining within the $20,000 to $25,000 range where it has stagnated since mid-June. The largest cryptocurrency recently traded as high as $22,400 before Tuesday’s widespread market selloff wiped away days of gains.
“Bitcoin has stabilized again around $20,000 after Tuesday’s bruising meeting with US inflation data,” said Craig Erlam, analyst at broker Oanda. “The question will be how the crypto space reacts to the Ethereum merger. It’s been a long time coming and the question on traders’ lips right now is whether it will be the next bullish catalyst for cryptos or a ‘sell fact’ event.”
Ether
was little touched in the hours since the merger was confirmed to have completed, with the price of the second-largest crypto up less than 1% to $1,600. Interest in the native token of the Ethereum blockchain network has surged ahead of the long-awaited upgrade, with Ether climbing around 50% since June in a notably better performance than Bitcoin.
“We will likely see the price of Ether pull back from recent highs,” said Naeem Aslam, an analyst at AvaTrade, pointing to the build-up of expectations that led to the merger and the likelihood that the upgrade may not be as smooth. as hoped. “Expect a bumpy ride.”
Speculation has been rife about where Ether is headed, especially in the highly liquid crypto-derivatives market – where traders have shown optimism over the merger in the options market, but have overwhelmingly shorted Ether futures. How traders react to the merger in the days and weeks ahead is likely to be an important factor across crypto, but more immediately analysts see weakness in Bitcoin and the potential for another leg down.
Bitcoin’s “price has consolidated up one month, down the next, up the next, down the next, within a clearly defined range,” noted the analyst behind the Rekt Capital newsletter, which is focused on cryptotechnical analysis.
This is typical range-bound behavior, the analyst said, representing prices going up one month, down the next and up the next. “This month we have already seen the full upside movement take place,” Rekt Capital said.
This could leave Bitcoin vulnerable to a weakening of the support around the $20,000 level – which has remained in recent months as a price at which traders are willing to step in and buy the token, according to the Rekt Capital analyst.
Beyond Bitcoin and Ether, altcoins or smaller cryptos were mixed.
Cardano
and
Solana
was up about 1%, while memecoins – originally intended as internet jokes – were lower, with
Dogecoin
and
Shiba Inu
each loses about 1%.
Write to Jack Denton at [email protected]
