Ethereum is losing its key level of support and falling to two-month lows versus Bitcoin

Ethereum’s native token Ether (ETH) gained more than 15% in the first 12 days of October. But, Compared to the 30% growth of Bitcoin (BTC) over the same period, the second largest cryptocurrency is currently in a downward trend when trading BTC.

So far, the exchange rate of the ETH / BTC pair has fallen by more than 12% in October (and in the fourth quarter of 2021), reaching 0.060215 BTC on October 12 for the first time in more than two months.

ETH / BTC daily price chart. Source: TradingView

The decline also pushed the ETH / BTC pair below one of its oldest support areas, the 200-day moving exponential average (200-day EMA; the orange wave).as shown in the graphic above. This increases the risk of further downward moves as 0.055304 BTC serves as the next possible target.

Bitcoin dominance rises on ETF hopes

Ethereum is losing its key level of support and falling to two-month lows versus Bitcoin
Ethereum is losing its key level of support and falling to two-month lows versus Bitcoin

Further evidence of the weakness of the ETH / BTC pair came from Bitcoin’s growing dominance in the cryptocurrency market.

Special, The Bitcoin Dominance Index, which measures the capitalization of the flagship cryptocurrency compared to the rest of the cryptocurrency market, rose from 42.39% on October 1 to 46.64% on October 12. On the other hand, the dominance of ether decreased from 18.15% to 17.57% over the same period.

Bitcoin Domain Index daily graph. Source: TradingView

This shows that more capital was turned in the Bitcoin market than in the Altcoin market in October.

Bitcoin’s growing dominance coincided with expectations that the US Securities and Exchange Commission could approve four Bitcoin-based exchange-traded funds (ETFs) within a few weeks.. Applicants are Global X Bitcoin Trust, Valkyrie XBTO Bitcoin Futures Fund, WisdomTree Bitcoin Trust and Kryptoin Bitcoin ETF.

SEC chairman Gary Gensler hinted at an optimistic outcome for Bitcoin ETFs, despite the SEC declining similar requests for eight consecutive years. Gensler pointed out that this time, however Bitcoin ETF applicants were filed under the Investment Company Act of 1940, which provides better protection for investors.

Earlier this week, two “light” Bitcoin ETFs started trading in the US, called Invesco Alerian Galaxy Crypto Economy ETF (SATO) and Invesco Alerian Galaxy Blockchain Users and Decentralized Commerce ETF (BLKC). However, the funds invest 80% of their assets in cryptocurrency-related companies, not Bitcoin itself.

SATO ETF 15-minute price chart. Source: TradingView

The SEC also approved a third crypto-stock ETF. Known as the Volt Crypto Industry Revolution and Tech ETF (BTCR), the fund will “get exposure to companies that have the majority of their net assets in Bitcoin or derive the majority of their profits from Bitcoin mining, borrowing or transactions.”

Is Bitcoin going “crazy”?

James Seyffart, an ETF analyst at Bloomberg Intelligence, said the news was “very bullish” on Bitcoin. Similarly, independent market analyst Lark Davis also predicts “crazy” market reactions if the SEC approves a Bitcoin ETF that has real BTC exposure.

I don’t think people are fully prepared for how crazy the markets are going to get once we get an approved #bitcoin ETF!

Thus, it appears that speculation about the approval of Bitcoin ETFs in recent days has increased traders’ appetites for the big cryptocurrency, with BTC outperforming its main rivals, including Ether.

Nevertheless, Ethereum has a strong ecosystem of decentralized applications and remains the key force in the rise of the decentralized financial and non-fungible token sectors.

David Gokhshtein, founder of Gokhshtein Media and PAC Global, noted that Ethereum’s healthy network effect could bring Ether to $ 10,000 by the end of this year. In the meantime, as Cointelegraph reported, A persistent supply crisis on the ether market should remain an important topic of conversation for the bulls in the future.

The views and opinions expressed are those of the author only and do not necessarily reflect the views of Cointelegraph.com. Every investment and trade move involves risk, you must conduct your own investigation when making a decision.

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