Ether, the second largest cryptocurrency, has fallen more than 20% against Bitcoin over the past six weeks. With the ETHBTC ratio remaining near its two-month low, sellers are working to stabilize the price below $3,400. This pressure led to a significant decline in an important metric of the chain, indicating potential further declines in its price.
Ethereum Decline Could Be Short-Term
Ethereum price has seen mixed market reactions with buyers and sellers facing liquidations. According to Coinglass, Ethereum saw a total of $35 million in liquidations over the past 24 hours, with $14 million coming from buyers and $21 million from sellers.
Data from IntoTheBlock indicates that Ethereum volatility has decreased over the past 30 days. A significant drop in volatility could be a negative sign for Ethereum, as it suggests less trading activity, which could reduce the chances of the price surpassing key resistance levels. Currently, the volatility rate stands at 42.6%.
At the time of publication, the ETH/BTC ratio, which indicates the value of Ether relative to Bitcoin, stands at 0.03194 according to TradingView data. This ratio has decreased by 19% since December 5, when Bitcoin first reached $100,000.
However, during the previous bull market cycle, the ETH/BTC ratio reached a low of around 0.03 in March 2021 and then climbed to 0.077 within two months. During this period, the price of Ether increased by 110%, reaching $3,817.
Also Read: Ethereum Price Prediction 2025, 2026 – 2030: Can ETH Price Reach $5,000?
As Bitcoin adoption grows, being bearish on Ethereum will be a mistake. Some believe that while many are focused on what US President-elect Donald Trump could do with Bitcoin during his term, Ether could also benefit indirectly from the wider adoption of Bitcoin.
Apollo co-founder Thomas Fahrer said that if the Bitcoin strategic reserve is implemented, it could drive the price of Bitcoin up to $1 million this cycle. He also noted that this would be positive for Ether, suggesting that a $4,000 price target could be achieved.
What’s next for the ETH price?
Ethereum price rose sharply, surpassing previous resistance levels and now trying to break above the immediate Fibonacci channel. However, it faces some selling pressure around the bearish resistance line, posing a significant challenge to buyers. Currently, Ethereum is trading at $3,343, having increased by 1.01% over the past 24 hours.
The ETH/USDT trading pair is sitting just below $3,430, which could pose a significant hurdle. If it manages to hold above this level, it could be beneficial for buyers, potentially pushing the price up to $3,730, and perhaps even as high as $4,000.
Conversely, if the price falls below the EMA20 trendline on the hourly chart, sellers could push it down to around $3,200. Nonetheless, the Relative Strength Index (RSI) at 52 suggests that there could be an uptick soon, as it indicates continued buying interest.
