Analyst predicts ETH/BTC will bottom in Q4 2024, with Ethereum facing short-term weakness before potential recovery in 2025.
Ethereum’s price is at a pivotal point, testing the $2,700 resistance zone after a surge of over 10% in the past week. This important juncture has attracted attention from analysts who foresee potential price fluctuations.
Despite the recent price rally, a market watcher anticipates Ethereum will face further declines before the end of 2024. Benjamin Cowen, CEO of Into The Cryptoverse, has drawn attention to the ETH/BTC pair’s long-term movement.
ETH/BTC Breakdown and Historical Parallels
Cowen has been vocal about Ethereum’s relationship to Bitcoin, with the ETH/BTC pair having dropped massively from last year’s levels. He noted that while many were once bullish on Ethereum flipping Bitcoin’s dominance, current trends show Ethereum weakening in comparison.
When I said that #ETH / #BTC was about to collapse last year, many people were calling for the flippening and scoffing at the idea that BTC dominance could go to 60%.
Now many of those same people have become anti-ETH and calling for its demise at 0.038. Lol. If you were bullish… https://t.co/rwqj5u4n8A pic.twitter.com/YndrSgMfdK
— Benjamin Cowen (@intocryptoverse) October 17, 2024
According to Cowen, the ETH/BTC ratio, which now hovers between 0.03 and 0.04, is likely to bottom out this quarter. This range has historically been a critical support zone, with Cowen suggesting that even in the worst-case scenario, the ratio might only dip as low as 0.03.
However, he points out that the time to capitalize on this trade was two years ago, cautioning against current panic selling.
Cowen also referenced similar breakdowns in Ethereum’s price history, specifically in Q4 2016 and Q4 2019, when ETH/BTC experienced significant declines. During these periods, Ethereum saw temporary weakness, but eventually regained strength.
Per Cowen, ETH/USD is expected to remain weak until the end of 2024, similar to previous breakdowns in 2016 and 2019 when ETH/BTC also declined. However, the analyst predicts a potential recovery and renewed strength for Ethereum in 2025.
Potential Bullish Reversal
While he expects continued weakness similar to previous market cycles, others, like Peter Brandt, see potential for a bullish reversal. The veteran market analyst recently identified a potentially bullish development for Ethereum.
According to Brandt, an Inverse Head and Shoulders (H&S) bottom pattern has started forming on Ethereum’s price chart, which could signal a reversal in its current downward trend.
The left shoulder formed in late July, when Ethereum’s price fell to $2,330, followed by a drop in September to a lower low of $2,253, marking the head. The right shoulder began to form in early October, as the price dipped but held above $2,330, indicating weakening bearish momentum.
However, this pattern is incomplete without a breakout above the neckline, which currently acts as resistance. If Ethereum can break through this level, it could signal a significant upward price movement.