Another bad omen for the broader crypto market is that bitcoin has been once again outperforming ether on a relative basis since early September.
Ether has been in sell-off mode following its successful merge, which shifted the Ethereum blockchain to a proof-of-stake system from proof-of-work. The decline in ether has led Stockton to believe there is an increased likelihood that the cryptocurrency can test $1,000 as support, r
epresenting potential downside of 27% from current levels.
“The shift favoring bitcoin is a bearish indication for the cryptocurrency markets broadly, reflecting defensive rotation as bitcoin and other altcoins get into support ‘retest’ mode,” Stockton said.
But bitcoin can alter its bearish trajectory if it successfully avoids a confirmed breakdown below support and reclaims resistance at $22,000, she said. Until then, expect the crypto bear market to continue.
