Ethereum’s native token, Ether (ETH), has fallen around 17% against the US dollar in the last two weeks. But its performance against Bitcoin (BTC) has been less painful with the ETH/BTC pair falling 4.5% over the same period.
The pair’s bearish move comes as both ETH/USD and BTC/USD fall almost in unison as they react to the Fed’s potential to raise rates by 50 basis points and cut their balance sheet by $95 billion per month. .
The latest figures released on April 12 show consumer prices rose 8.5% in March, the most since 1981.
Breakout from the triangle of the ETH/BTC pair
Various technicals remain bullish despite the drop in the ETH/BTC pair over the past two weeks. Based on a classic continuation pattern, the pair still looks set to resume its strong uptrend in 2022.
In particular, the ETH/BTC pair has corrected from a horizontal resistance level that forms an ascending triangle range along with an ascending trend line support.
As a general rule, ascending triangles send the price in the direction of its previous trends. Therefore, Since the ETH/BTC pair rallied before forming one, there is a good chance that its bull run will continue towards its February 2018 highs near 0.1 BTC, based on the setup shown in the chart below.
However, the provisional market setup looks skewed to the downside, with the ETH/BTC pair eyeing a correction towards the lower trendline of the triangle following its pullback from the upper trendline.
The bearish reversal scenario
Ascending triangle breakouts hit their upside targets almost 73% of the time, a study by Samurai Trading Academy shows.
In a separate report, veteran investor Tom Bulkowski also highlights a 70% success rate for ascending triangles, underlining the strong possibility of Ether reaching 0.10 BTC in 2022.
However, this still leaves the ETH/BTC pair with a 30% chance of invalidating its ascending triangle setup.
As it happens, the pair will break below the lower trendline of its triangle, which also coincides with its 50-week exponential moving average (the red wave in the chart above) near 0.06 BTC, which opens the door. to a further drop to 0.05 BTC, a support area from May to June 2021.
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