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The native asset of the Ethereum blockchain breached its downward sloping resistance trendline to the upside, generating a classic bullish outlook.
According to a famous technical pattern, Ethereum’s native token, Ether (ETH), might see a 40% price increase against its main rival, Bitcoin (BTC).
The structure, known as a “symmetrical triangle,” arises after the price produces a series of higher lows and lower highs. This leads in the convergence of two trendlines with a degree of symmetry, forming a triangle.
Analysts regard symmetrical triangles as trend continuation indicators, which means that after a clear breakout, they normally move prices in the direction of their prior trend. As a result, the current ETH/BTC price surge may continue to rise after fluctuating inside a similar triangle shape for the last four months.
Ether’s effort to break above its triangle consolidation setup after climbing seven weeks in a row for a total gain of 179 percent is one of the reasons. If it occurs, the ETH/BTC exchange rate might rise by the maximum height of the triangle (about 0.025 BTC) from the point of its breakout (approximately 0.069 BTC).
This puts the pair’s profit target near 0.094 BTC, which is roughly 40% higher than 0.069 BTC.
On an intraday basis, Ether surpasses Bitcoin in dollar terms, indicating an optimistic prognosis for the cryptocurrency.
The ETH/USD exchange rate increased 6.61 percent to $3,442, its highest level in three months, on August 31. In comparison, Bitcoin’s gains were dwarfed, climbing only 2.5 percent to $48,169, indicating a larger temporary demand for Ether tokens among traders.
Dmitry Mishunin, founder and CEO of smart contract audit firm HashEx, believes Ethereum and other “smart contract-enabling blockchains” will continue to surpass Bitcoin in the long run due to their better utility.
“The combination of Cardano and Ethereum has the potential to support a plethora of new initiatives,” Mishunin said, adding that Ethereum has the ability to outperform Bitcoin in the long run.
“Bitcoin only relies on its capped supply and the first-mover advantage, a trend many investors are beginning to substitute for unique technology that can drive a blockchain-dominated future.”
Jon Ovadia, founder and CEO of cryptocurrency exchange Ovex, also stated that Ethereum had superior fundamentals than Bitcoin at the moment, owing to its recent network update, which attempted to provide deflationary pressure to Ether via a fee-burning mechanism.
“Thus far, about 146,878.7 ETH (worth approximately $492.3 million) have been burnt from the total circulating supply,” Ovadia said, adding that:
“The potential for a more superior Proof-of-Stake infrastructure through the highly anticipated launch of Ethereum 2.0 will also make the blockchain more usable, thus driving the coin’s utility and its price growth.”
Bitcoin’s outlook, meanwhile
So far in 2021, Ether has outpaced Bitcoin because to its increasing acceptance in the burgeoning decentralised finance (DeFi) and nonfungible token (NFT) businesses. As of August 31, Ether’s year-to-date profits were 373 percent versus Bitcoin’s 63.55 percent.
Nevertheless, Mike McGlone, senior commodity strategist at Bloomberg Intelligence, said Bitcoin would eventually catch up to Ether’s gains, thus leading to $100,000 by the end of 2021 — more than double the price at which it is trading at the time of writing.
Fundstrat Global Advisors’ Tom Lee also envisions a six-figure bid for Bitcoin as long as it stays above its average price of the last 200 days — a long-term momentum measure.