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Ethereum price rises by 50% against Bitcoin in one month — but there’s a catch

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Ether (ETH), Ethereum’s native token, has been persevering with its uptrend in opposition to Bitcoin (BTC) as euphoria round its upcoming community improve, “the Merge,” grows.

ETH at multi-month highs in opposition to BTC

On the day by day chart, ETH/BTC surged to an intraday excessive of 0.075 on Aug. 6, following a 1.5% upside transfer. In the meantime, the pair’s features got here as part of a broader rebound pattern that began a month in the past at 0.049, amounting to roughly 50% features.

ETH/BTC day by day value chart. Supply: TradingView

The ETH/BTC restoration partially has surfaced because of the Merge, which may have Ethereum change from proof-of-work (PoW) mining to proof-of-stake (PoS).

Ethereum’s “rising wedge” suggests sell-off

From a technical perspective, Ether stares at potential interim losses as ETH/BTC paints a convincing rising wedge

Rising wedges are bearish reversal patterns that happen when the worth developments larger inside a variety outlined by two rising, converging trendlines. As a rule, they resolve after the worth breaks beneath the decrease trendline by as a lot because the construction’s most top.

ETH/BTC day by day value chart that includes “rising wedge” breakdown setup. Supply: TradingView

Furthermore, a declining quantity and relative energy index (RSI) in opposition to a rising ETH/BTC additional will increase bearish divergence dangers. This offers weight to the wedge’s bearish setup for a goal of 0.064 BTC, or down 11% from as we speak’s value.

Ether seems stronger vs. greenback

In the meantime, technicals paint a brighter image for Ethereum in opposition to the U.S. greenback. The potential of a ten% breakout for ETH/USD seems robust in August as a consequence of a traditional bullish reversal sample.

Associated: Decentralized finance faces multiple barriers to mainstream adoption

On a four-hour chart, ETH/USD has fashioned what seems to be a “double backside.” This sample resembles the letter “W” as a consequence of two consecutive lows adopted by a change in route from downtrend to uptrend, as illustrated beneath.

ETH/USD four-hour value chart that includes “double backside” breakout setup. Supply: TradingView

In the meantime, a double backside sample resolves after the worth breaks above its frequent resistance degree and—as a rule of technical evaluation—rises by as a lot as the gap between the primary backside and the resistance. 

In consequence, ETH may rally towards $1,940 in August, up 10% from as we speak’s value.

The views and opinions expressed listed below are solely these of the writer and don’t essentially replicate the views of Cointelegraph.com. Each funding and buying and selling transfer entails danger, you need to conduct your personal analysis when making a call.