With the recent approval of the Ethereum ETF, and thanks to the narrative that the approval of new ETFs for several other cryptocurrencies could come later, many enthusiasts and people involved in the blockchain and cryptocurrency world think that an ALTSEASON is possible and almost imminent in the coming weeks in 2024.
Now, taking into consideration that this is not investment advice, and that there are always both possibilities in the financial markets, in addition to the fact that it is necessary and essential to rigorously manage risk in order to survive in the financial markets, let's take a closer look at the market with the help of the charts:
This chart shows the price of ETH relative to BTC over time, and will help us to come up with some ideas and scenarios of what could happen in the market in the coming months:
Currently, ETH price has broken the lows of the BEAR MARKET that occurred in 2022 with respect to BTC, but it has not broken the lows of the 2020-2021 altseason price range. We can see that from May 2021 to May 2024, Ethereum's price against BTC has clearly remained sideways with a downward inclination between the values of 0.048 and 0.088 ETH/BTC approximately. This roughly 33-36-month sideways drop has occurred in the premium zone of the previous altseason's range, i.e. in the upper 50% price zone of the range. This could be considered BULLISH as ETH price has remained at the top of the range all this time.
However, there is something that strongly catches my attention, and that is that, after the bull market of 2017, there was also a lateralization of ETH/BTC of around 33 months, during 2018, 2019 and 2020, but that time it was at the bottom of the price range of the previous altseason, that is, in the price discount zone, Bottom 50% of the range. If we consider a basic concept of SMC, and its creator ICT, in trading you buy at a Discount and sell at a Premium, which sounds quite logical and simple, but it is the opposite of what most traders do in the financial markets. (That's why 90% lose money.)
With the latter in mind, we could define the current range as a possible distribution and expect drops in the price of ETH/BTC, which would be the opposite of the optimal conditions to have an ALTSEASON. By way of conclusion, I think it is possible that we will see a MINI ALTSEASON, i.e. prices will rise in the short term in the coming weeks or months but I would not be convinced that the move is really to break the ETH/BTC highs.
MY TARGET: 0.07 ETH/BTC
