Ethereum Faces Continued Downtrend Against Bitcoin Amid Market Weakness

According to Cointelegraph, Ethereum's native token, Ether (ETH), has repeatedly entered oversold territory against Bitcoin (BTC) in recent months, yet it has not shown signs of establishing a price bottom. The current trading scenario mirrors a previous pattern, suggesting that ETH's market structure might repeat itself in the second and third quarters of this year. The relative strength index (RSI) for ETH on a three-day timeframe remains below 30, typically indicating a potential price bounce. However, historical trends reveal that previous dips into oversold conditions have not marked a definitive bottom, with each occurrence followed by further declines, indicating persistent bearish momentum. Since mid-2024, the ETH/BTC pair has experienced multiple breakdowns, with losses of approximately 13%, 21%, 25%, and 19.5% in quick succession. Additionally, the 50-day and 200-day exponential moving averages (EMAs) are trending downward, confirming the absence of bullish strength. Market analyst @CarpeNoctom has pointed out ETH's negative price performance, noting that the ETH/BTC pair has failed to confirm a bullish divergence on its weekly chart, where the price makes lower lows but the RSI makes higher lows. The ongoing ETH/BTC downtrend is notable when compared to the broader crypto market, including persistent outflows from US-based spot ETH ETFs and negative onchain data. Net flows into spot Ether ETFs dropped 9.8% in March to $2.54 billion, while spot Bitcoin ETF net flows decreased by 2.35% to $35.74 billion during the same period. Meanwhile, Ethereum's gas fees, measured by daily median gas consumption on the mainnet, were around 1.12 GWEI as of March, a significant decrease from the previous year. Despite a second rally in ETH prices towards the end of 2024, mainnet activity, as measured by gas consumption, did not fully recover. Data analytics platform Nansen noted that much of the activity has shifted to Solana and Layer 2 solutions over 2024. Nansen remains cautiously bearish on ETH due to its unfavorable risk/reward ratio compared to Bitcoin and lower-valued altcoins with niche market focus. The ETH/BTC pair is forming a bear pennant pattern on the daily chart, characterized by consolidation within converging trendlines following a steep decline. A bear pennant typically resolves when the price drops below the lower trendline, potentially leading to a 15% decrease from current levels. The 50-day and 200-day EMAs continue their downward trajectory, with the ETH/BTC pair trading well below these key levels, indicating a persistent bear market structure. Despite the downside risk, a bullish invalidation could occur if ETH/BTC breaks above the pennant's upper resistance and turns the 50-day EMA into support.