ethereum vs bitcoin

The second-largest cryptocurrency posts dwarfed losses compared to Bitcoin's 21% price decline Saturday.

Ethereum's native token Ether (ETH) plunged alongside other cryptocurrencies on Dec. 4. Still, its move downside did not deter it from hitting a three-year high against Bitcoin (BTC), the world's leading crypto by market capitalization.

The ETH/BTC exchange rate jumped a little over 11.50% to hit 0.0835 BTC for the first time since May 2018. The pair's price rally appeared in contrast to Ether's 15% price drop against the U.S. dollar on Saturday, which appeared in the wake of a market-wide selloff that saw Bitcoin plunging by as much as 21% intraday.

The ETH vs. BTC "hedge" narrative emerges

While Ether's losses were substantial, they were relatively milder compared to Bitcoin in USD terms as the ETH/BTC pair surged to a three-year high. At the same time, some analysts believed that investors started treating the second-largest cryptocurrency as a haven against Bitcoin during the Saturday crash.

"It seems that investors are taking ETH as a hedge here," said Crypto Birb, an independent market analyst in a tweet Saturday, pointing to a four-hour ETH/BTC price chart (as shown below) that showed the pair retracing sharply after testing its 200-period moving average (the orange wave) as support.

Lukas Enzersdorfer-Konrad, chief product officer at Bitpanda, noted that ETH/BTC's November close was the best one in the last 45 months, meaning bulls still had "some power left for an additional run."

"Ethereum is outperforming Bitcoin by a large margin this year [...] It increased its market dominance to 22%. The number of active addresses on the network continues to climb while the net issuance of ETH continues to fall which might be the main reason for its rapid rise."

Technical outlook

As Cointelegraph covered earlier, Ether has shown the prospects of continuing its upward trend due to a technical support pattern, dubbed Ascending Triangle.

Related: Ethereum ‘about to go parabolic’ against Bitcoin as analysts weigh BTC bear case

On Saturday, the ETH/BTC pair broke out of the Ascending Triangle range to the upside, accompanied by a slight increase in its trading volumes. In a "perfect" world, the pair's move upside should stretch until it hits levels at length equal to the maximum distance between the Triangle's upper and lower trendlines when measured from the breakout point.

In a "perfect" world, the pair's move upside should stretch until it hits levels at length equal to the maximum distance between the Triangle's upper and lower trendlines when measured from the breakout point.

As shown in the chart above, the Triangle's upside target, from the breakout point near 0.077 BTC, puts the profit target near 0.1 BTC.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.

Ethereum price hit a new all-time high in its ETH/BTC pair and a classic technical analysis pattern suggests the altcoin has a lot more upside.

This week, Ether (ETH) price reached a new 2021 high against Bitcoin (BTC), bringing its year-to-date returns slightly above 350% and according to technical analysis, the rally could extend even further.

On Dec. 1, bids for the ETH/BTC pair hit 0.0835 BTC on Coinbase for the first time this year. The upside move came as a part of an uptrend that started mid-October after Ether bottomed out against Bitcoin at 0.0630 BTC to carve out almost 41% price retracement.

Growing adoption propels Ether's boom

The ETH/BTC price rally reflect deep interest in Ethereum, which is currently the world's leading smart contract platform by users and market capitalization. This is slightly different than the scenario for Bitcoin, which typically functions as a speculative hedge against inflation across global economies.

As of late, Ethereum has been become a core asset within crypto growth sectors like nonfungible tokens (NFT), decentralized finance (DeFi) and the Metaverse. The firms operating in this space require Ether to run their smart contracts, which in turn, has increased demand for the altcoin and supported a steady uptrend in its price.

Demand for Eth is expected to remain robust in the coming year and this simple fact has many analysts projecting prices within the $6,000 to $10,000 range. 

Matt Maley, the chief market strategist for Miller Tabak + Co., anticipated additional gains for Ether should it break above its mid-November high around $4,900. According to Maley, Bitcoin bulls remain under pressure near the cryptocurrency's mid-November and mid-April highs of $69,000 to $65,000.

If Ether manages to hit and hold a new all-time high while BTC trades in a downtrend, Maley said:

"It will show that Ether has become the new crypto of choice for most investors."

The technical outlook for Ether against Bitcoin has also been suggesting stronger bull runs for the former in the future.

Related: Ethereum approaches a new ATH, but derivatives data reflects mixed emotions

A prolonged bullish breakout could be in play

The latest bout of buying has had ETH/BTC break above a multi-month resistance trendline that constitutes an ascending triangle pattern and now the pair eyes an extended bull run towards 0.1 BTC, as shown in the chart below.

Typically, ascending triangles are continuation patterns, meaning, they tend to send the price in the direction of its previous trend by as much as the maximum height between the upper and lower trendline when measured from the breakout point.

ETH/BTC's breakout point comes out to be near 0.077 BTC while its triangle's maximum height is 0.022 BTC. In a "perfect" world, this would place the ETH/BTC pair on path to 0.1 BTC, but given the volatile nature of the cryptocurrency sector, anything is possible. 

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.