Ethereum and the aggregated cryptocurrency market have been consolidating for the past few days, with Bitcoin’s recent swing past $16,000 helping to provide a base of support for ETH and other altcoins.
The crypto market’s ongoing uptrend is driven almost entirely by Bitcoin, but ETH and most other major altcoins are still woefully underperforming the benchmark digital asset.
There have been some early signs of a capital rotation event away from BTC and into altcoins, with a few DeFi tokens, in particular, seeing immense momentum throughout the past several days.
Some of these tokens were able to post gains clocking in at 100% or more in a mere matter of hours, signaling that they had previously been oversold.
That being said, where they trend next – and whether they can mark their recent lows as a long-term bottom – will depend almost entirely on Ethereum.
While speaking about ETH, one trader explained that he believes it could soon help altcoins rocket higher. For this to happen, ETH/BTC will have to print some large green candles in the near-term, or else further downside could be imminent.
Ethereum Holds Steady Around $470 as Buyers Absorb Selling Pressure
At the time of writing, Ethereum is trading up just under 2% at its current price of $470. Earlier this morning, its price plunged to lows of $466 in a sharp downwards movement, but buyers rapidly stepped up and reverted this decline.
$470 appears to be an important level for ETH, and a high time frame close above it could help open the gates for it to see further upside.
If it can post a weekly candle close above this level, it could soon see some major momentum that sends it past $500.
Analyst Claims Altcoins Could Rally if ETH/BTC Can Climb
One trader explained in a recent tweet that altcoins could extend their recent momentum and further confirm their recent lows as a long-term bottom if ETH/BTC can rally.
He notes that Bitcoin seeing some slowing momentum while Ethereum rallies will provide an ideal backdrop for higher risk tokens to grow upon.
“The only explanation I have for alts pumping with BTC is that BTC will stall here and ETH / BTC is prepping another scam candle. In other words, number go up. All numbers go up.”
Image Courtesy of Mac. Source: ETHBTC on TradingView.
The coming few days should provide some serious insight into where the altcoin market will trend toward the end of the year.
It may all depend on where Ethereum’s Bitcoin pair trends.
Featured image from Unsplash. Charts from TradingView.