The price of Ethereum is closing in on Bitcoin’s recent performance, and as the price of Bitcoin has trended lower, the price of ETH has followed suit. However, Ethereum itself appears to have more bearish fundamentals compared to Bitcoin, leading cryptocurrency analysts to believe that the second-largest cryptocurrency by market capitalization could fall further from here.
Ethereum is poised to experience a bigger crash
A cryptocurrency analyst known as Shin Forex took to the TradingView website to share some interesting analysis on the Ethereum price. Analysis focused on the ETH/BTC chart revealed some details regarding the development of the ETH price.
The analyst explained that Ethereum’s liquidity was decreasing during this period. Instead of flowing to altcoins like ETH, it is flowing to Bitcoin. This means there is growing apathy towards Ethereum from investors and as liquidity flows towards Bitcoin, Ethereum currently has nothing to back it up.
Additionally, the cryptocurrency analyst explains that the ETH/BTC pair has now fallen below the support level of 0.05. Now, falling below the support level is significant considering what has happened every time it has been broken. Shin Forex points back to the last two market cycles (2016 and 2019) when ETH/BTC was below support.
Both times this happened, prices plummeted before rising again. The cryptocurrency analyst does not expect anything to be different this time around and believes ETH/BTC will fall below 0.04. If this happens, Ethereum will skyrocket and analysts have set a price target of around $2,500 for it.
Can ETH Price Survive a Collapse?
According to cryptocurrency analysts, the near-term is not looking good for Ethereum price. Especially since altcoins are currently trending downward within their current channel. However, if you zoom in on a larger time frame, you can get an idea of how the ETH price could move after the crash.
Looking at the last two Synforex charts where this type of situation occurred, a precedent was set for money flowing back into Ethereum. Although the price crashed in November 2016, it made a huge recovery within a few months, with ETH/BTC hitting new all-time highs.
Source: TradingView.com
A similar thing happened in 2019, with a slump coming ahead of a market rally, albeit now a little more slowly. Therefore, if this trend holds, an ETH collapse is inevitable. However, the recovery is expected to trigger the start of another major rally.
For now, bears continue to dominate the Ethereum market and have successfully driven the price below $3,000. is trading at. According to Coinmarketcap, it is $2,975 at the time of writing and is down slightly 0.36% on the last day.
ETH price falls below $3,000 | Source: ETHUSD on Tradingview.com
Featured image from Quora, chart from Tradingview.com
Source: NewsBTC.com