Ethereum Returns to 1600-Day Support
The price of Ethereum (ETH) has fallen under a descending resistance trend line since September 2022, reaching a low of ₿0.049 in December 2023. This low confirmed a long-term ascending support line that has been in place for nearly 1,600 days. On the other hand, the resistance trend line has been in place for nearly 500 days.
RSI Generates Bullish Signal
The Relative Strength Index (RSI), used by traders to determine market conditions, has generated a bullish signal. The weekly RSI for ETH/BTC has moved outside its oversold territory and created a bullish divergence, which has only occurred once before in June – December 2019 and led to a significant upward movement.
What Do the Analysts Say?
Cryptocurrency traders and analysts believe that ETH will soon bottom against BTC despite the ongoing downtrend. Bob Loukas suggests that there is a good chance ETH/BTC will bottom in late January and not be tested for at least two years. Dentoshi notes that the Dencun upgrade will help reduce network congestion and Layer-2 fees, potentially reversing the price trend. CryptoMichNL suggests that the Bitcoin Dominance Rate (BTCD) will reach a top soon, which is bullish for the ETH/BTC pair.
ETH Price Prediction: Is the Bottom Close?
On the 2-day chart, there are bullish signs despite the downward trend. ETH is trading near the support trend line of a descending parallel channel, which typically contains corrective movements. The RSI has also generated significant bullish divergence associated with local and absolute bottoms. If ETH deviates below the support level, it may reach the ascending support trend line and move upward towards the channel’s resistance, indicating a potential increase of nearly 20% from the current price. However, a breakdown from the channel could lead to a 30% drop to the next support level.
Hot Take: Ethereum (ETH) Shows Bullish Signs Against Bitcoin (BTC)
The Ethereum price has recently shown bullish signs against Bitcoin, with the RSI generating a bullish signal and analysts predicting a potential bottom. While there are still risks involved, such as a breakdown from the descending parallel channel, the overall sentiment for ETH/BTC is optimistic. Traders and investors should closely monitor these developments and consider their own risk tolerance before making any investment decisions.
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