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Crypto analyst Miles Deutscher points to an important indication on the Ethereum vs. Bitcoin daily chart. Deutscher points to the fact that Ethereum is currently attempting a breakout and a successful support/resistance (S/R) flip on its Bitcoin daily chart.
$ETH is currently attempting a break out + a successful $ETH/BTC S/R flip on the daily.
— Miles Deutscher (@milesdeutscher) April 4, 2023
We’re seeing the makings of a capital rotation into ETH ahead of the Shanghai (Shapella) upgrade.
Sustained strength would bode well for alt performance. Let’s see if it holds. pic.twitter.com/pXmIHylbOF
Ethereum's price turned oversold against Bitcoin after reaching near eight-month lows of $0.062 on March 21. This was followed by a relatively short period of range trading before a rise started on April 3.
According to Deutscher, the newfound strength Ethereum is seeing on its Bitcoin BTC chart might reflect the makings of capital rotation ahead of the Shanghai update.
Staked ETH withdrawals will be made possible by the Shanghai upgrade, also known as "Shapella," which completes Ethereum's entire transition to a proof-of-stake (PoS) network. The long-awaited Shanghai hard fork has an April 12 target date, according to Ethereum developers.
The fact that the last time Ethereum traded at such oversold levels to Bitcoin, it produced fresh highs on the ETH/BTC chart raises the possibility of a sustained rebound in the coming weeks.
Sustained strength might bode well for altcoins
Deutscher notes that the sustained strength of Ethereum against Bitcoin would bode well for the altcoins' performance. Oftentimes, the altcoin market tends to benefit from Ethereum's show of strength against Bitcoin, with this often an indicator of altcoins' performance.
On the upside, Ethereum faces a barrier that coincides with the moving averages on its Bitcoin chart. A successful flip into support might dictate the next move in the coming days.
Meanwhile, going back to the ETH/USD chart, crypto analyst Ali says Ethereum appears to be breaking out. According to him, on-chain data reveals that the next critical resistance area is between $2,100 and $2,150, where over 200K addresses had previously purchased over 18 million ETH.
Alex Dovbnya
Vladislav Sopov
Dan Burgin
U.Today Editorial Team