Key Takeaways:
- Ethereum continued its price decline against Bitcoin in March.
- A growing banking crisis has boosted demand for Bitcoin among retail players.
- But a potential rebound is on the cards.
YEREVAN (CoinChapter.com) — Ethereum’s native asset, Ether (ETH), has fallen to its eight-month low versus its top-ranking rival, Bitcoin (BTC), as the investors’ worries over the ongoing banking crisis deepen.
On March 20, the widely-tracked ETH/BTC dropped nearly 0.75% to 0.0631, its worst since July 2022. Moreover, the plunge came as a part of an ongoing bear trend, wherein the pair lost about 14.5% in a week after establishing a local top at 0.0735.
ETH/BTC versus Anti-Bank Narrative
Traders’ interest in Bitcoin has grown primarily due to a narrative that projects it as a safe-haven against the banking crisis.
For instance, BTC has outperformed not just Ether but almost all the top-ranking cryptocurrencies amid the collapse of Silvergate, Silicon Valley Bank, Credit Suisse, and others. Moreover, the coin may continue to do so amid reports that 186 US banks could fail in 2023 due to rising interest rates and uninsured deposits.
“The ETH/BTC pair is going to go all the way down to 0.055 IMO,” says Altcoin Sherpa, an independent market analysis, citing a technical support level going all the way back to the May-June 2021 session.
“It had a multiyear range back in 2018-2021, guessing this one is the same. It’s already been in the same range for nearly 2 years.”
On a brighter note, institutions appear less bearish on Ethereum than on Bitcoin. That looks evident from the fund flow data published on March 13 by CoinShares, showing Ethereum-based investment funds witnessing $10.1 million in outflows in March versus Bitcoin funds’ $256.6 million in outflows in the same period.
Notably, the outflows could be due to investors’ securing their profits ahead of a potential price correction in the dollar-based crypto market. For instance, Bitcoin’s price is up 20% in March versus Ethereum’s 8% price rally in the same period.
Will Ethereum Recover Against Bitcoin?
In the short term, an ETH/BTC price recovery seems possible.
In detail, the pair’s ongoing drop has pushed its price near its multi-month ascending trendline support level. However, a previous run-down toward the same level in June 2022 met with strong accumulation, leading to an almost 60% rebound toward the pair’s descending trendline resistance.
The same could happen in the coming days or weeks, i.e., a sharp ETH/BTC rebound from the current support level of 0.0616 toward the descending trendline resistance at around 0.0723. In other words, a 10-15% price rally.
The post Ethereum Underperforms Bitcoin as Banking Crisis Deepens — How to Trade ETH/BTC in March? appeared first on CoinChapter.
