The recent buzz surrounding Bitcoin ETFs and the upcoming halving event has led to increased demand for Bitcoin compared to Ethereum. As a result, the price of Ethereum’s native token, Ether (ETH), has reached a 15-month low against Bitcoin, the lowest since Ethereum switched to proof-of-stake (PoS).
The ETH/BTC pair dropped to as low as 0.056 BTC, breaking below its 200-week exponential moving average (EMA) near 0.058 BTC. This breach raises downside risks for Ethereum in 2023, with the next target being around its 0.5 Fib line near 0.051 BTC. However, if Ethereum manages to reclaim the 200-week EMA as support, it may rebound towards its 50-week EMA near 0.065 BTC.
Institutional capital flow data also reflects Ethereum’s weakness compared to Bitcoin, with Bitcoin-specific investment funds attracting $246 million year-to-date, while Ethereum funds have experienced outflows worth $104 million in the same period. This discrepancy is likely due to the anticipation of a potential spot Bitcoin ETF approval in the U.S., which could attract significant investment.
Furthermore, Bitcoin’s upcoming halving event on April 24, 2024, is acting as a tailwind for Bitcoin compared to the altcoin market. The halving will reduce the block reward for Bitcoin miners, which has historically resulted in a bullish case by cutting new supply in half.
In summary:
– Bitcoin ETF and halving buzz have boosted Bitcoin’s demand compared to Ethereum.
– Ethereum’s price against Bitcoin has reached a 15-month low and the lowest since switching to PoS.
– The breach of the 200-week EMA raises downside risks for Ethereum in 2023.
– The next target for ETH/BTC is around its 0.5 Fib line near 0.051 BTC.
– Reclaiming the 200-week EMA as support could lead to a rebound towards the 50-week EMA near 0.065 BTC.
– Bitcoin-specific investment funds have attracted significant capital, while Ethereum funds have experienced outflows.
– The anticipation of a spot Bitcoin ETF approval and the upcoming halving event are contributing to Bitcoin’s strength compared to altcoins.