Ethereum (ETH) has rallied by less than 20% in 2024, while Bitcoin (BTC) has risen by over 50%.
The last time Ethereum formed a death cross on the weekly chart was in March 2022, and the coin dropped by over 70% after that.
If the trend continues, Solana may surpass Ethereum this month. Solana has handled .9 billion so far, compared to Ethereum’s billion.
Ethereum has also formed a death cross pattern as the 200-day and 50-day Hull Moving Averages made a bearish crossover. The HMA reduces lag by using weighted moving averages to smooth out price data.
Additionally, this consolidation is happening at the 50% Fibonacci Retracement level. Therefore, there are increasing chances that the coin will have a strong bearish breakout in the near term, with the next target to watch being ,111, its lowest point on Aug. 5.
Ether has also formed a bearish pennant chart pattern, which is characterized by a long vertical line followed by a symmetrical triangle. Typically, an asset experiences a bearish breakout when the two lines of the triangle converge.
This performance is largely driven by the popularity of Solana (SOL) meme coins like Dogwifhat, Bonk, and Popcat have become popular among traders. All Solana meme coins have gained over billion in market cap.
Therefore, a combination of weak fundamentals and technicals could push Ether lower in the coming weeks.
Additionally, some high-profile Ethereum whales, including Vitalik Buterin and the Ethereum Foundation, have sold thousands of coins recently.
According to SoSoValue, these funds have had cumulative outflows of over 0 million, primarily due to the Grayscale Ethereum Fund. In contrast, Bitcoin ETFs have crossed the billion inflow level, pointing to higher demand from institutional investors.
Ethereum’s weak fundamentals
Ethereum is also seeing intense competition in areas it used to dominate like DeFi and NFTs. Data by DeFi Llama shows that Solana has crossed Ethereum in terms of DEX volume in the last seven days. It handled .87 billion compared to Ethereum’s .69 billion.
Technicals point to more Ether weakness in the coming months. On the weekly chart, the coin formed a double-top chart pattern around ,000. It dropped below the neckline of this pattern at ,824 in July, confirming the bearish breakout.
