Ethereum Carries Bitcoin Price Up, Will “The Merge” Live to Expectations?
The Bitcoin price has been stuck below $20,000 as Ethereum and other altcoins take over the price action and push the sector upwards. Ethereum just deployed the “Bellatrix” upgrade, the final step before “The Merge”, and the price of Ethereum is blazing through local resistance.
At the time of writing, Bitcoin price trades at $19,900 with sideways movement across the last 24 hours and 7 days respectively. In the meantime, the Ethereum price trades at $1,670 with a 7% and 8% profit over the same time periods, respectively.
Ethereum Could Breakout Of This Range While The Bitcoin Price Lags
“The Merge” will migrate the Ethereum network from a Proof-of-Work (PoW) consensus to a Proof-of-Stake (PoS) consensus. This event has caused a lot of hype across the crypto markets, as some investors believe Ethereum will see more improvements and will enter a new era of adoption.
As seen in the chart below, a pseudonym trader outlines Ethereum price current range and its attempt to break out of overhead resistance. If Ethereum validates this bullish move, the cryptocurrency might achieve another milestone and “flip” Bitcoin in terms of market capitalization.
Of course, “The Merge” poses many questions for investors as they wonder if this will operate as a “buy the rumor, sell the news” event. The pseudonym trader said:
ETH attempting to break out of a range. The last time it did so it doubled relative to BTC If it doubles again relative to BTC it’ll flip it. Will Bitcoiners let it happen? Or will they mercilessly pump BTC to stop the ratio from getting worse? Or will it all dump for a reset?
Can Ethereum Flip Bitcoin?
Trading desk QCP Capital might provide some clues into some of these questions. In a recent report, the firm claims Ethereum price has been correcting after reaching oversold levels in the aftermath of the Three Arrows Capital (3AC) liquidations.
Therefore, a lot of the move upward might be the price bouncing back as selling pressure faded and less related to “The Merge”. There are two potential bullish factors associated with “The Merge”: the transition will reduce ETH supply issuance while increasing its burning rate.
While the former is “looking bullish”, QCP claims, the latter is trending to the downside. In other words, the supply is being burned at a slower rate heading into “The Merge”. QCP Capital added:
This doesn’t change our view on the long-term viability of ETH, and its consequent bullish impact on price. We think ETH will be THE asset of the decade. However, it does change the short-to-medium-term price dynamics, and how much of the event is already priced in.
As “The Merge” approaches, the trading firm will look into Ethereum price mimicking the Bitcoin price “halving” effect. This could provide ETH’s price performance with further support to reclaim its previously lost territory and continue to push the sector up with it, including the Bitcoin price.
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