Analyst Jason Pizzino states that Ethereum($ETH ) and altcoins are gearing up for a breakout, with ETH exhibiting a similar pattern to what was seen in 2020.
According to Pizzino, the ETH/BTC pair is currently sending a “major signal for altcoins.” However, he cautions that altcoins might continue to decline before market sentiment shifts and a bull run begins.
“The ETH/BTC pair saw a recovery in November, but it hasn’t yet surpassed a 4% increase. The key level I’m watching to assess the price divergence is 0.046 BTC. If the price surpasses this threshold, we could witness an imbalance in the upward direction. Ideally, as long as the 0.032 BTC level isn’t breached, the price will maintain this imbalance for an extended period—during which extreme greed, excitement, and confidence dominate, leading people to believe these markets will never fall again.
However, the market hasn’t reached this point yet, so I believe the price will continue to consolidate. Until that happens, you’re unlikely to see the extreme euphoria previously observed during a strong market rally.”
The analyst notes that the ETH/BTC chart is currently reflecting a pattern similar to what occurred in 2020 before a significant price surge.
“This is reminiscent of what happened in December 2020, and what followed in January 2021 was a massive rally: trading volumes surged, and the market reversed sharply.
Let’s revisit January 2021. Trading volumes started increasing at the beginning of the month, followed by a sudden reversal. On December 27, 2020, prices began climbing, and by January 3, 2021, a strong upward move had occurred. On January 3 and 4, ETH/BTC began breaking past old highs and then consolidated above those support levels.
The price rose by about 3% before pulling back slightly. While it dropped, this created the necessary balance, meaning there were more buyers over a sustained period, allowing the price to remain high. That’s exactly what the market needs. However, this pattern has yet to fully emerge on the ETH/BTC chart.”