ETH/BTC Slips to Lowest Since December 2020 as Ethereum Loses Key Support

However, the native asset of the world’s most valuable smart contracts blockchain has dropped at a faster pace than its peers lately. As a result, it has lost a fair share of its dominance.

The value of the ETH/BTC pair, which is used to analyze how Ethereum is performing relative to Bitcoin (BTC), has dropped to its lowest level since December 2020.

This indicates that ETH’s market cap is deteriorating much further during this market crash than the top crypto asset. So far this year, ETH has gone down by 42.9% and its price at the time of writing stands at around $1,880 per coin.

Other competing altcoins like Solana (SOL) and BNB Chain (BNB) have performed better during this period as they have experienced milder losses of 35.6% and 22.3% respectively.

This severe weakness has pushed Ethereum’s dominance to its lowest level since May 2020 at 8.8%. In addition, the total value locked (TVL) within the Ethereum network has collapsed from its December local peak of $74 billion to $45.8 billion.

However, investors have not been pulling out money from the ecosystem despite the market’s depressive attitude. The amount of stablecoins held within the Ethereum (ETH) has actually grown from around $111 billion on December 31 to $122 billion at the moment.

$200M Worth of Long ETH Positions Were Wiped in the Past 24H

Crypto liquidations have skyrocketed in the past 24 hours to $908 million. A total of $202 million worth of ETH long positions have been flushed out of the system during this period.

The severity of ETH’s 24-hour drop has almost equaled the amount of liquidations that BTC traders faced during this period, which is not a common occurrence.

This could be the result of ETH losing a key support level at $2,000 that acted as a cushion during the latest sell-offs. Now that this support has been lost, it could act as resistance in the next few days.

If bulls fail to recapture this level, the crash may exacerbate and could push Ethereum (ETH) to its lowest levels since October 2023.

Momentum indicators are favoring a bearish outlook for the token as the Relative Strength Index (RSI) has moved below the signal line while the MACD’s histogram is once again showing steadily rising dark red bars.

A couple of support areas pop up in the daily chart that investors could watch in the next few days, the first one at $1,750 and the next one at $1,510. This implies a 21.2% downside risk for ETH in the near term if bulls fail to push the price above $2,000 again in the next couple of sessions.

Bulls Struggle to Recapture the $1,900 Level

Moving to the hourly chart, we can see how ETH has made three consecutive lower highs since Saturday. All of these have been followed by steep declines. Now, bulls seem to be struggling to maintain ETH above the $1,900 level.

Momentum indicators have not yet sent a sell signal but the psychological and technical relevance of this threshold suggests that a rejection of this level could lead to a retest of the $1,750 level.

Short-sellers continue to have the upper hand in this environment as the trend favors them. If a stop price is set at around $2,000 and the exit target at $1,750, a short position would offer a 1.7 risk-reward ratio at the current price of $1,911 per coin.