ETH/BTC Priming For A Bounce?

Bitcoin has taken the spotlight in recent weeks, as the top dog cryptocurrency surged to all-time-high territory in just 2 months of parabolic price-action. However, Ethereum has gained some ground in the past few days, suggesting that a temporary market dynamic change could be in the works. ETH/BTC priming for a bounce?

Specifically, Bitcoin and Ethereum tend to take turns in propelling the crypto industry forward. From May to August, for example, Ethereum led bitcoin in both performance and price-action; and during this latest run-up to all-time highs, the reverse was true.

As noted in mid-November, the Ethereum-Bitcoin chart neared a crucial make-or-break pivot point on which price bounced spectacularly. A series of confluent factors and technical indicators suggested that this move was likely and it played out quite well.

By and large, the 0.02780 Satoshi level has been a long-term pivot point that denoted bear and bull trends in the ETH/BTC pair. In this case, the upwards trending support line provided structural support while the Relative Strength Index (RSI) showed decreasing sell-side pressure with a clear bullish divergence on the daily time-frame. Finally, the move was compounded with a double-bottom structure.

The question on everyone’s mind now is: will there be follow through?

Given the significance of this bounce and historical evidence, it’s reasonable to think this. A sustained break above the head and shoulders neckline could provide fresh impetus to push Ethereum outside the 0.02-0.038 Satoshi trading block towards the next macro pivot point at 0.05337 Satoshis. This could take several weeks to months.

(Click on image to enlarge)

ETH/BTC daily chart as of December 2nd, 2020. ETH/BTC priming for a bounce?

ETH/BTC daily chart as of December 2nd, 2020.

Failing that, then investors looking for short term upside might aim to enter on a final retest of the upwards sloping support above 0.027620 satoshis. In the event that the floor doesn’t hold, then Ethereum and many alt-coins will probably witness a bloodbath of epic proportions. However, bearing in mind that Ethereum has yet to reach its all-time high in USD terms, the prospect of another ‘leader’ flip isn’t at all far-fetched. Indeed, Ethereum is still 124% away from it’s all-time highs, and a rising tide lifts all boats.

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Disclaimer: All published information represents the opinion and analysis of Mr Florian Grummes & his partners, based on data available to him, at the time of writing. Mr. Grummes’s ...

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