The price of Ethereum (ETH) has outperformed Bitcoin (BTC) over the past four weeks, despite the decline in the price of ETH/USD.
The number of waves and indicator readings from the daily time frame suggest that the price will continue to outperform BTC, reaching highs not seen since 2018.
Ethereum price failed to sustain an increase
Technical analysis of the weekly time frame in the ETH/BTC pair is mixed. The price has been trading in a range between 0.055 and 0.078 since May 2021.
A trading range is a neutral sign because the price usually bounces between support and resistance lines before making a final move outside of it.
It is possible that the price is trading inside a descending parallel channel. However, the support line of the model has not been adequately verified.
If the pattern is confirmed, the fact that the price is trading at the top of it will be a bullish sign. In contrast to the support line, the center line has been validated multiple times (green symbols).
Furthermore, the weekly RSI is giving a mixed reading. Using the RSI indicator as a momentum indicator, traders can determine whether the market is overbought or oversold and decide whether to accumulate or sell an asset.
If the RSI reading is above 50 and the trend is up, the bulls have the advantage, but if the reading is below 50, the opposite is true. The indicator is increasing but it is still below 50, and it does not provide any clues as to the direction of the trend.
ETH Price Prediction: Has the Price Bottomed?
The daily time frame overview provides a bullish outlook for many reasons.
First, the number of waves indicates that the bottom has been reached. Using the Elliott Wave theory, technical analysts examine long-term price patterns and investor psychology that recur to determine trend direction.
According to the count, the price has completed the corrective ABC structure (white), where wave B has taken the shape of a triangle.
The fact that the correction ended at the Fibonacci retracement support level of 0.618 supports this possibility.
Subsequently, the daily RSI established a bullish divergence. This is an event in which a decrease in momentum does not coincide with a decrease in price. It often leads to bullish trend reversals.
Moreover, the index is now above 50, which is another sign of an uptrend.
Despite this bullish prediction for ETH price, a drop below wave C low of 0.062 would mean that the trend is still bearish.
In this case, a drop to the 0.058 support area would be the most likely scenario.
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In line with Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate and unbiased reporting, but market conditions are subject to change without notice. Always do your own research and consult with a professional before making any financial decisions.