The strong trend in the crypto market continues. Thus, the leading currency Bitcoin has once again overcome the mark of $ 50,000 and has risen to highs of around $ 52,000. At the time of publication, the BTC/USD rate is slightly lower at around $ 51,300. Thus, the Bitcoin is trading about 8 percent higher than the previous week.
ETH rises three times stronger than BTC
However, this trend is significantly exceeded by the current growth of Ethereum. With an increase of around 24 percent, ETH/USD has risen three times faster than Bitcoin over the same period. Thus, Ethereum now reaches a level of just under $ 4,000. The market capitalization has increased to about 460 billion dollars. ETH / USD is now already close to half the market value of Bitcoin and is thus clearly catching up with the market leader.
Investors are now likely to be eager to see if the $ 4,000 becomes a strong hurdle for ETH/USD on which a significant correction is expected, or if the Ethereum price manages to confirm its strong trend and possibly next to test the all-time high from May 2021. At that time, the leading altcoin reached a level of around $ 4,400 . Currently, Ethereum is only 10 percent away from this magical mark.
135 Percent Rally since July 2021
The rally of the last few weeks is quite impressive. As recently as July, Ethereum had reached lows of around $ 1,700. Within a short period of time, the cryptocurrency was able to record an incredible increase of more than 135 percent and has brought massive profits to investors who got in on time. For example, an investment of 10,000 dollars could yield a return of 13,500 dollars within a very short time. Of course, experienced traders could have raised this amount even further by trading leverage.
If you compare the price development in the entire bull cycle 2020/2021, buyers of Ethereum have made the clearly better investment than investors of Bitcoin. In numbers, ETH / USD has risen more than 1,000 percent in the past 12 months. The Bitcoin price also comes to a considerable 400 percent during this period, which is significantly less than Ethereum.
The evolution of the balance of power between Bitcoin and Ethereum can also be seen well on the ETH/BTC chart. According to this, there was only around 0.02 Bitcoin for an ETH token in May 2020. In the meantime, things look very different. For an Ethereum coin, there is already 0,076 bitcoin. This means that investors only need around 13 ETH to be able to afford a whole Bitcoin.
Bullish double bottom scenario fulfilled
But does this bull run of Ethereum continue? The chart analysis can provide information on the further course of the price and the dominance compared to Bitcoin.
On the 4-hour chart, it can be seen that BTC/USD formed a double bottom at $ 1,700 on July 20. After all, this mark was already formed on June 26, that is, about a month earlier, as a strong level of support. The double bottom is an extremely bullish scenario in technical analysis, if confirmed. To do this, the course must successfully cross the neck line, that is, the highest point between the two low points of the double bottom.
ETH / USD has behaved the same way, loosely reaching the technical price target of this chart formation. This is calculated on the basis of the distance between the low point and the neck line. The price level of the neckline is then added with the difference to get the price target. Since the neckline was around $ 2,400, the price target was $ 3,100.
ETH / USD Continues to Rise Against Probability
However, the Ethereum price has formed even more chart formations that can be seen. ETH / USD has also been in so-called rising wedges since the low point at $ 1,700. These patterns are characterized by converging support and resistance lines. These formations are thus initially characterized by further price increases, but ultimately tend to break down.
Ethereum has initially tested multiple resistance and support in a first of these patterns. However, against the probabilities of technical analysis, the Ethereum price has managed to break out of the chart formation upwards, which can be considered a very bullish signal. At around $ 2,950, ETH / USD has left the rising wedge and confirmed the resistance line as new support multiple times.
However, Ethereum has subsequently formed the next rising wedge and has risen further up to around $ 3,700. However, the bullish run of the ETH / USD price has still not been ended, as the altcoin has once again managed to exit the formation upwards.
So Ethereum is now in another, larger rising wedge whose resistance line makes price targets between $ 4,400 and $ 4,500 possible. What does this mean for the short-term trend of the ETH price?
New all-time high coming soon?
If ETH / USD can continue to hold in this formation, the probability is relatively high that the altcoin will soon be able to create another 10 percent increase and thus test the all-time high from May 2021 again. This sounds very bullish at first and could lead Ethereum to new records.
But beware: in the price range of $ 4,400, very bearish scenarios could also occur for the ETH price. First of all, the rule that a break down from the chart formation is more likely than up continues to apply in the rising wedge. Even if Ethereum was able to break this rule to last, the formation’s upper resistance line is not likely to be easy to break. Especially since this is the all-time high and many buyers may have deposited sell orders here.
Is the bearish double-top formation looming?
The second potentially bearish pattern is the so-called double-top formation. Unlike the double-bottom scenario described above, it is considered a frequent turning point of a trend. Thus, in the worst-case scenario, Ethereum could start a strong correction here, possibly lasting for months. Because the two tops of this potentially bearish pattern would be months away, it is then a large chart formation.
But this scenario is far from confirmed and the bulls are currently still in the upper hand. However, that ETH / BTC chart is also interesting. Because this potentially shows the same double-top pattern in terms of ETH-BTC dominance. This means that Ethereum could again lose significantly in value relative to Bitcoin if the scenario occurs.
Analysts: $ 5,700 by year-end
In principle, however, analysts are still clearly positive about the Ethereum price development. Coin Price Forecast expects a bullish year-end spurt for ETH/USD with a price target of just under $ 5,700 by December. Also, the market watchers of Wallet Investor believe that Ethereum will crack the $ 5,000 mark by the end of the year. It remains to be seen whether these forecasts will come true.