Ethereum’s losing streak against Bitcoin lasts 15 months – Can ETH price reverse course?

The price of Ethereum’s native token, Ether (ETH), is at its lowest level in 15 months compared to Bitcoin (BTC) and is the lowest since Ethereum switched to Proof-of-Stake (PoS).

Will it continue to weaken for the rest of 2023? Let’s take a closer look at the charts.

Ethereum price falls below critical support versus Bitcoin

The ETH/BTC pair fell as low as 0.056 BTC earlier this week. This caused the pair to break below its 200-week exponential moving average (200-week EMA; the blue wave) near 0.058 BTC, increasing downside risks into 2023.

The 200-week EMA has historically served as a reliable support level for ETH/BTC bulls. For example, the pair recovered 75% three months after testing wave support in July 2022. Conversely, it fell over 25% after losing the same support in October 2020.

Weekly ETH/BTC price chart. Source: TradingView

ETH/BTC faces similar sell-off risks in 2023 after losing its 200-week EMA as support. In this case, the next downside target is likely to be at the 0.5 Fib line near 0.051 BTC in 2023, representing a decline of around 9.5% from current price levels.

Conversely, ETH price could rally towards its 50-week EMA (the red wave) near 0.065 BTC if it reclaims the 200-week EMA as support.

Bitcoin bull case overshadows Ethereum

Ethereum’s continued weakness against Bitcoin is reflected in institutional capital flow data.

For example, Bitcoin-specific mutual funds have attracted $246 million year-to-date (YTD) as of October 6, according to CoinShares. On the other hand, Ethereum funds have lost capital and recorded $104 million in outflows over the same period.

Net inflows into crypto funds (by assets). Source: CoinShares

The discrepancy is likely due to increasing excitement over possible spot approval of a Bitcoin exchange-traded product (ETF) in the US

Trading experts argue that the spot launch of a Bitcoin ETF will raise $600 billion. Furthermore, Bitcoin’s fourth halving on April 24, 2024 is also acting as a tailwind for the altcoin market.

Related: Bitcoin price gets new target of $25,000 as SEC decision day boosts GBTC

The halving will see Bitcoin miners’ block reward drop from 6.25 BTC to 3.125 BTC, a bullish scenario based on historical precedent that halves the new supply.

This article does not contain any investment advice or recommendations. Every investment and trading activity involves risks and readers should conduct their own research when making their decision.

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