Despite the ongoing crypto market turmoil, Ethereum’s native token Ether has been growing stronger than its competitor Bitcoin (BTC). Can the ETH/BTC pairing continue to rally over the next months? Let’s take a look at the charts.
Ethereum reduces YTD losses in comparison to Bitcoin
Between the May 9 low at 0.0720 and its May 10 high at 0.0759, ETH/BTC gained 5.5%. ETH rebounded by nearly 9.75% against U.S. dollars, while Bitcoin experienced a similar upside retracement during the same period.
Daily price chart for ETH/BTC Source: TradingView
After a severe selloff over the past 24 hours, the gains across all pairs were realized. This drop saw Ether fall to its lowest levels since January 2022, and Bitcoin fell below $30,00 for only the second time since July 2021.
Similar conditions were found in traditional markets. The U.S. benchmark index S&P 500 (SPX) fell 3.2% to its lowest level since 2022.
The dollar, on the other hand, reached its two-decade peak, reinstating its “safe haven” status during market turmoil. The demand for the USD-pegged stablecoins, which are essentially cryptocurrency, also increased.
$USDT Exchange Outflow Volume (7d MA) just reached a 3-month high of 34,010,868.697 USDT View metric:https://t.co/D90kNIpU2J pic.twitter.com/Xzb5DEXaqs
— Glassnode Alerts (@glassnodealerts May 10, 2022
Technicals for ETH prices hint at breakout
ETH/BTC’s gains led to its close to testing its multimonth horizontal trendline resistance as resistance. This appears to be an “ascending triangular” pattern.
Trend continuation patterns are those that indicate an ascending triangle. They send the price in the same direction as its previous trend.
ETH/BTC Weekly Price Chart with ‘Ascending Triangle’ breakout. Source: TradingView
Technical analysis dictates that traders will profit if they make a decisive breakout above a triangle’s horizontal trendline.
ETH/BTC is looking for a similar breakout move to its horizontal resistance at 0.110 BTC. This is more than 50% increase from May 10, when it was priced.
Related: An analyst claims that crypto trading platforms sell Bitcoin.
A pullback towards the triangle’s rising lower trendsline (also coinciding with its 50 week exponential moving average; the red wave), could be possible if ETH/BTC are rejected near the horizontal trendline. This is 11.25% less than May 10’s price.
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