While there was a decline in the cryptocurrency market led by Bitcoin (BTC), Ethereum (ETH) and altcoins also had their share of this decline.
At this point, Ethereum, which exceeded $ 4,000 in the rally in March, is currently at $ 3,200 while experiencing a decline of approximately 20%.
While investors are now looking forward to the rise, the ETH/BTC pair is sounding an alarm on the weekly chart.
According to Coindesk news, a death cross is about to form on the ETH/BTC weekly chart. Analysts stated that the ETH/BTC rate fell below an important support level and said, “Ethereum's poor performance against Bitcoin may be a sign of investors' risk aversion and decreased demand for altcoins.”
While the upcoming death cross in the ETH/BTC pair indicates that Ethereum and other altcoins may experience long-term underperformance compared to Bitcoin, QCP Capital analysts also examined the decline in the ETH/BTC pair.
Analysts pointed out that there was a persistent and large sale on the Ethereum side and said that it put pressure on the price:
“ETH/BTC pair is testing a critical support level after breaking below 0.05.
There has been a persistent and massive sell-off in ETH calls, which has crushed volatility and also put downward pressure on the price.
Could this be a very early signal of FOMO turning into fear in ETH as a proxy for altcoins?”
What is Death Cross?
Death-Cross: The short-term average crosses the longer-term average from top to bottom. This intersection is considered important as a sign of great weakness.
So this pattern occurs when a shorter-term moving average, such as a 50-week, falls below a longer-term moving average, such as a 200-week.
Often thought to lead to a significant price drop, a death cross is seen as a warning for investors to be careful.
*This is not investment advice.