ETHEREUM, the big catch-up has finally begun!Introduction: In our previous TradingView analyses, we defended the bullish recovery of the crypto market since the beginning of April, particularly for the bitcoin price. The latter seems to be positively correlated with the global liquidity trend (you can reread all our latest crypto analyses in our analysis history directly from the main page of our TradingView profile).
In this new analysis, we discuss the return of Ethereum's outperformance of Bitcoin.
1) ETH/USD bullish cycle: what are the theoretical price targets highlighted by technical analysis of the financial markets?
The current bullish cycle for ETH/USD began in the summer of 2022, with prices rebounding from the all-time high of the penultimate cycle, which peaked at $1150 in January 2018. A chartist base for a bullish reversal had developed between July and November 2022, before the uptrend began shortly after the FTX bankruptcy.
A well-constructed uptrend then took place until March 2024, with an intermediate high reached at $4,000, a resistance that three times produced a bearish rejection effect. The ETH/USD rate finally rallied back above major support at $1150/1350 and now appears to have resumed a bullish bottom trajectory in alignment with the bitcoin price.
2) Ethereum VS Bitcoin, the great catch-up may have begun
The question investors are now asking is whether or not Ethereum is in a position to outperform bitcoin in the coming weeks. To answer this question, we need to look at both fundamental and technical aspects.
On the fundamental level, the very recent “Pectra” update considerably improves the functioning of the Ethereum blockchain, notably by reducing transaction costs. This update could be the fundamental element underpinning a return to Ethereum's outperformance of Bitcoin.
In terms of technical analysis, it is the ETH/BTC ratio that helps determine Ethereum's cycles of outperformance and underperformance against Bitcoin. Technical analysis of the ETH/BTC ratio highlights the presence of long-term chart support, which seems to have enabled a clear rebound in the ETH/BTC rate.
Consequently, if this major support remains preserved over the coming weeks, then yes, it's becoming increasingly likely that ETH/USD will do better than BTC/USD over the next few weeks on the crypto-currency market. This market view would be invalidated in the event of a breakout of the major support mentioned and which is represented on the chart below.
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