Ethereum’s native token, Ether (Eth), has dropped its multi-year lows against bitcoin (Btc), which motivates analysts to predict further decline in the coming weeks.
Knife warning sells sales dangers
On March 13, the Ether/BTC – a pair that tracks Ether’s strength against Bitcoin – which has been thrown over 1.50% to reach $ 0.022, its lowest level from May 2020.
ETH’s descent is part of the multi-year downtrend that began when it established a record of $ 0.156 in June 2017. Since then, it has dropped by more than 85%, emphasizing Ether’s growing weakness against Bitcoin.
Meanwhile, in the two-week chart of ETH/BTC, the relative index of strength (RSI), a momentum indicator used to measure if a owner is excessive or excessive, has fallen on a note of less than 23.32.
ETH/BTC Two-Week Price Price. Source: Tradingview
Usually, when the RSI drops below 30, it indicates oversold conditions, which potentially lead to a price rebound.
However, in Ethereum’s case, the RSI continued to collapse even less even two months after becoming oversold, suggesting that the collapse of the ETH was still speeding up rather than stabilizing.
Crypto analyst Alessandro Ottaviani has described The situation as a “falling knife” scenario – a term used to describe a possession that experiences a quick and steep decline, consumers often discouraged from walking as soon as possible.
A falling knife indicates that the attempt to catch the owner of a noticeable low can lead to additional losses if the downend continues.
For Ethereum to signal a potential return -Beak, merchants will guard for RSI stabilization and recovery of basic levels of resistance. That ideal starts with a rebound from the 0.022 BTC level, with limited attempts at falling ETH/BTC in December 2020, leading to a 300% rally.
ETH/BTC Weekly Price Price. Source: Tradingview
If a rebound occurs, the ETH/BTC pair can rally towards the 0.382 fibonacci retracement line around 0.038 BTC, which aligns with the 50-week exponential transfer of average (50-week EMA; the red wave).
Until then, the technical point of view suggests that the ETH/BTC can remain trapped in the falling knife trajectory, with the next potential downside targets at history support levels within a range of 0.020-0.016 BTC.
ETH/BTC Two-Week Price Price. Source: Tradingview
The lowest point of this range is approximately 30% below the current price levels.
ETH/BTC basis supports a bearish view
Ether prospects that are still declining against Bitcoin are rooted in factors beyond technical examination.
For example, Ethereum is currently faced with strong competition from Layer-1 rivals, especially Solana (Sol).
Related: ‘The worst thing that has ever happened in Ethereum ‘ – Bitcoin up to 160% since combining
Vaneck mentioned that Solana’s decentralized quantity exceeds Ethereum’s even in a steep collapse in Memecoin trading activity. Meanwhile, Solana’s volume has continued to rise in recent months, coinciding with a decline in Ethereum volumes.
Solana compared to Ethereum Dex Volume. Source: Vaneck
Moreover, the launch of the Bitcoin ETFs spot has Fundamentally changed the traditional crypto market cycle used to benefit Ethereum and other altcoins.
Historically, after posting bitcoin on post-halving, the capital revolves around the altcoins, triggering a “Altseason“Where the eth and other possessions exceed BTC. However, the $ 129 billion flowing with bitcoin etf In 2024 this cycle was interrupted, the drainage of liquidity from the wider Altcoin market – including Ethereum.
Bitcoin Dominance Index Weekly Price Price. Source: Tradingview
Another factor is the Ethereum that is a certain pressure on sale.
The Recent bybit hack reported to lead to a major eth Laundered by decentralized platform such as thorchain. The absorbed sale-off can still be rippling through the market, depressed ETH relative value.
This article does not contain investment advice or recommendations. Every transfer of investment and trading involves risk, and readers should conduct their own research when deciding.
