Altcoins were showing remarkable strength after a slight move from Bitcoin price earlier. Gaining momentum, altcoins, primarily Ethereum, showed a noticeable tendency to break above $3,000 levels. However, the bear quickly capitulated the space and dragged the price below $2,500. To be sure, the asset is undergoing a remarkable turnaround, but fears of a substantial drop still haunt the rally.
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In a recent update, a crypto analyst warns that Ethereum and the entire altcoin market could drop soon. The ETH/USDT pair shows the possibility of losing value, but the BTC pair keeps hope alive. As the price of ETH continues to be different from the $3,000 mark, the analyst believes that the asset has reached an extremely fragile point.
“If we break below this range that we have on the chart, which is somewhere around the worst case scenarios, 0.06 in ETH/BTC ratios, we are currently at 0.66. If we get another 10% drop compared to that index, this could be a telltale sign that the market is ready for a longer drawdown.”
He believes that 0.06 is the crucial zone that can decide the next price trend for Ethereum and the altcoin space. At the time of writing, the price of Ethereum is trading at $2,708 and the ETB/BTC pair is hovering around 0.065.
More bearish scenarios for Ethereum!
As the price of ETH does not trade even close to $3000 for a long time, the futures premium has dropped significantly. The basis point of the three-month annualized contract trades below 5% for a long time. Despite a slight recovery, market participants are unwilling to go long on the asset.
Source: laevitas.ch
However, another scenario that fuels the bearish scenario is the net long to short ratio. Traders are more interested in shorting the price of ETH rather than longing for the asset. And therefore, with an increased concentration of ETH shorts, the price is also expected to have a negative impact.
Source: Coinglass
The ratio is calculated by taking into account the positions of the top traders in the particular time period. Currently, 52.67% of traders have shorted the asset compared to 47.33% of them who have been long. Therefore, continuing the Ethereum (ETH) price trend may witness a noticeable downtrend in the future.
This post Ethereum and Altcoins in danger! Will ETH Price Break $2500 Again?
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