- Ethereum has dramatically underperformed Bitcoin over the past two weeks.
- The coin has gained 13% in the past two weeks while BTC has gained 20%.
- Analysts think that the gap may begin to close shortly.
- One trader noted that there are a number of technical signals derived from the Ichimoku Cloud indicator suggesting Ethereum will move higher.
Ethereum Forms Pivotal Bull Signals
Ethereum has dramatically underperformed Bitcoin over the past two weeks. The leading crypto asset has gained around 13% as BTC has surged closer to 20%.
Despite this underperformance on a short term basis, analysts think that ETH will soon see an explosion in price appreciation.
One crypto-asset analyst shared the chart below on October 27th. It shows that Ethereum is currently underperforming BTC but may soon catch up due to a number of technical signals. He specifically pointed to three technical signals, derived from the Ichimoku Cloud indicator. These signals are as follows:
- Ethereum has retested the flat Tenkan level, which confirms it as support. This level is important for bulls to hold during uptrends.
- The Chikou is pointing up after the bounce on the Kumo (the cloud).
- Ethereum’s future cloud has twisted into the green, suggesting a bull trend is forming.
“$ETH hasn’t even started yet: retested the flat Tenkan, chikou pointing up after bounce on Kumo, bullish future (twist). Spot buys done here Ballot box with check. Opening Perps on 1st blue HA candle / break of WF”
Chart of ETH's price action vs that of Bitcoin over the past few weeks with analysis by crypto trader Trading Cyclist (@Fullgastrader) Source: ETHUSD from TradingView.com
Likely to Outperform BTC Moving Forward
Despite this, analysts think that Ethereum may outperform Bitcoin moving forward.
Su Zhu, CIO and CEO of Three Arrows Capital, recently shared the following sentiment:
“$BTC going up swiftly is not only not bullish for alts but it’s bearish. reasons for this are myriad but boil down to the fact that money is a coordination game and Bitcoin is the Schelling point; this is independent of how you feel about it, community is literally irrelevant.”
$BTC going up swiftly is not only not bullish for alts but it's bearish
reasons for this are myriad but boil down to the fact that money is a coordination game and Bitcoin is the Schelling point; this is independent of how you feel about it, community is literally irrelevant
— Su Zhu (@zhusu) October 19, 2020
We’ve seen this play out quite well over the past week. As aforementioned, as Bitcoin has rocketed higher, ETH has been lagging.
Ethereum may continue higher, though, once Bitcoin begins to consolidate and capital made in BTC longs begins to cycle down the crypto risk spectrum.
This may not take place for a while, though. Analysts also note that the Bitcoin dominance metric, which tracks how altcoins perform against BTC, is set to move higher.
Featured Image from Shutterstock Price tags: ethusd, ethbtc Charts from TradingView.com Ethereum Hasn't Even Started: 3 Technical Signs Suggest Bull Trend Coming