Will Ethereum be able to overtake bitcoin in terms of price dynamics in the second half of the year?
Date: 2023-08-27 Author: Karina Ziganova Categories: BLOCKCHAIN
In the first six months of 2023, Ethereum (ETH) played a minor role, but starting in July, it began to overtake the main cryptocurrency in terms of price dynamics.
In the first half of 2023, the price of ETH increased by 58%, from $1,200 on January 1st to $1,900 on June 30th. Bitcoin, meanwhile, posted an 83% gain. At the moment, the crypto market is in the “red zone”, but Ethereum is holding afloat a little better - the price of the second largest cryptocurrency by capitalization sank by 13%, while BTC lost 15%.
BTC Dominance Decreases Significantly
The dominance of Bitcoin (BTC.D) has steadily declined over the past two months as crypto investors shifted their focus to the altcoin market. The chart below shows that BTC.D peaked at the end of June 2023 at 52%.
Since then, the indicator has lost 3% and as of August 24 is 49.28%.
BTC.D tracks the percentage of the total global cryptocurrency market capitalization that is held by bitcoin. A steady downward trend indicates a change in market sentiment and an outflow of investor capital from BTC.
If this trend continues, Ethereum could further outperform BTC in the second half of the year.
Against the backdrop of a cryptocurrency market downturn, investors look to Ethereum
After a massive market crash last week, Ethereum is on the verge of a recovery. The daily Relative Strength Index (RSI) consolidated above the critical level of 30, and on August 24 it briefly reached the level of 33.
The current oversold condition could lead to a bullish reversal in the ETH market in the coming days. Given the decline in Bitcoin dominance, Ethereum's position could become even more profitable.
ETH Price Prediction: Steady Consolidation Above $1,500
Considering the above factors, the price of ETH is likely to be able to successfully counter bearish sentiment.
The In/Out of Money Around Price data confirms this possibility. The chart below shows that 5.11 million investors purchased 7.04 million coins at an average price of $1580. They will provide significant support to the asset and try to prevent further decline. However, if the bearish momentum proves too strong, ETH could drop below $1,500 for the first time since March 2023.
In case of a rebound from the current values, the initiative will return to the bulls again. 6.55 million addresses will stand in their way, having bought 6.14 million coins at a maximum price of $1900 - but if their efforts are enough, the Ethereum rate will quickly return to $2000.
