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Ethereum’s native token, Ether (ETH), looks poised to log a major price rally versus its top rival, Bitcoin (BTC), in the days leading toward early 2023.

Ether has a 61% chance of breaking out versus Bitcoin

The bullish cues emerge primarily from a classic technical setup dubbed a “cup-and-handle” pattern. It forms when the price undergoes a U-shaped recovery (cup) followed by a slight downward shift (handle) — all while maintaining a common resistance level (neckline).

Traditional analysts perceive the cup and handle as a bullish setup, with veteran Tom Bulkowski noting that the pattern meets its profit target 61% of all time. Theoretically, a cup-and-handle pattern’s profit target is measured by adding the distance between its neckline and lowest point to the neckline level.

The Ether-to-Bitcoin ratio (or ETH/BTC), a widely tracked pairing, has halfway painted a similar setup. The pair now awaits a breakout above its neckline resistance level of around 0.079 BTC, as illustrated in the chart below. 

As a result, a decisive breakout move above the cup-and-handle neckline of 0.079 BTC could push Ether’s price toward 0.123 BTC, or over 50%, by early 2023.

A $250 surprise rally took place between Oct. 25 and Oct. 26, pushing the price of Ether (ETH) from $1,345 to $1,595. The movement caused $570 million in liquidations in Ether’s bearish bets at derivatives exchanges, which was the largest event in more than 12 months. Ether’s price also rallied above the $1,600 level, which was the highest price seen since Sept. 15.

Let’s explore whether this 27% rally over the past 10 days reflects any signs of a trend change.

It is worth highlighting that another 10.3% rally toward $1,650 happened three days later on Oct. 29, and this triggered another $270 million of short seller liquidations on ETH futures contracts. In total, $840 million worth of leveraged shorts was liquidated in three days, representing over 9% of the total ETH futures open interest.

On Oct. 21, the market became optimistic after San Francisco Federal Reserve President Mary Daly mentioned intentions to step down the pace of interest rate hikes. However, the United States central bank’s previous tightening movement has led the S&P 500 stock market index to a 19% contraction in 2022.

Despite the 5.5% stock market rally between Oct. 20 and Oct. 31, analysts at ING noted on Oct. 28 that “we do indeed expect the Fed to open the door to a slower pace through formal forward guidance, but it may not necessarily go through it.” Furthermore, the ING report added, “It could be that we get a final 50bp in February that would then mark the top. This would leave a terminal rate of 4.75% to 5%.”

Bitcoin (BTC) rallied on the back of the United States stock market’s 3.4% gains on Oct. 28, with the S&P 500 index rising to its highest level in 44 days. In addition, recently released data showed that inflation might be slowing down, which gave investors hope that the Federal Reserve might break its pattern of 75 basis-point rate hikes after its November meeting.

In September, the U.S. core personal consumption expenditures price index rose 0.5% from the previous month. Although still an increase, it was in line with expectations. This data is the Federal Reserve’s primary inflation measure for interest rate modeling.

Additional positive news came from tech giant Apple, which reported weak iPhone revenues on Oct. 27 but beat Wall Street estimates for quarterly earnings and margin. Moreover, Apple chief financial officer Luca Maestri said services would grow year-over-year in the fourth quarter. 

Bitcoin futures data shows reluctant buyers

Retail traders usually avoid quarterly futures due to their price difference from spot markets. Still, they are professional traders’ preferred instruments because they prevent the perpetual fluctuation of contracts’ funding rates.

These fixed-month contracts usually trade at a slight premium to spot markets because investors demand more money to withhold the settlement. But this situation is not exclusive to crypto markets, so futures should trade at a 4%–10% annualized premium in healthy markets.

Bitcoin (BTC) is delivering striking similarities to its last bear market, but the recent bottom may be its last, research says.

In a tweet on Oct. 31, popular trading account Stockmoney Lizards furthered the bull case for BTC/USD.

Bitcoin “repeats itself” in 2022

The past few days have seen talk of Bitcoin encountering a “double top,” with two spikes over $21,000.

The implication is bearish: Declining volume suggests that bulls will not be able to flip the level to support, and many expect fresh macro lows to come next.

New analysis offers an alternative, more optimistic, perspective. For Stockmoney Lizards, the similarities between 2022 and 2018 are hard to ignore.

Bitcoin (BTC) begins a key week of internal and macroeconomic events still trading above $20,000.

After its highest weekly close since mid-September, BTC/USD remains tied to higher levels within a macro trading range.

The bulls have been keen to shift the trend entirely, while warnings from more conservative market participants continue to call for macro lows to enter next.

So far, a tug-of-war between the two parties is what has characterized BTC price action, and any internal or external triggers have only had a temporary effect. What could change that?

The first week of November contains a key event that has the potential to shape price behavior going forward — a decision by the United States Federal Reserve on interest rate hikes.

Binance Coin (BNB) has hit new all-time highs against Bitcoin (BTC) as excitement grows over the crypto’s future role on Twitter.

Binance Coin sets new record against BTC

Data from Cointelegraph Markets Pro and TradingView confirms that BNB/BTC briefly spiked above 0.15 BTC to a record 0.15267 BTC on Oct. 30.

The in-house token of Binance, the largest crypto exchange by volume, has gained around 10% in the past 72 hours.

The strong performance came on the back of reports that Binance was preparing to assist Twitter eradicate bots as part of its new direction under Elon Musk.

Binance had contributed $500 million to Musk’s takeover of the social media platform.

Bitcoin (BTC) continued consolidating into the Oct. 30 weekly close as concerns over a deeper retracement became vocal.

Trader avoids new longs below $21,000

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD circling levels just below $21,000 on the day.

Weekend trading had produced an early return above the $21,000 mark, this short lived as Bitcoin bulls failed to offer the volume to sustain higher levels.

Now, popular trader and analyst Il Capo of Crypto sensed a change of direction was ultimately due for Bitcoin and altcoins alike.

Altcoins themselves had also performed strongly through the weekend, notably led by Dogecoin (DOGE), which was up another 25% in the past 24 hours at the time of writing and at six-month highs.

The Dogecoin (DOGE) price rally extended further on Oct. 29 in hopes that the cryptocurrency would get a major boost from Elon Musk's Twitter acquisition.

Elon Musk boosts Dogecoin price again

Dogecoin price jumped by nearly 75% to reach $0.146 on Oct. 29, the biggest daily gain since April 2021.

Notably, the meme-coin's massive intraday rally came as a part of a broader uptrend that started earlier this week on Oct. 25. In total, DOGE's price gained 150% during the Oct. 25-29 price rally.

The surge was also accompanied by a decent increase in its daily trading volumes. That coincided with a spike in the number of DOGE transactions exceeding $100,000, according to Santiment. Both indicators sugges a growing demand for Dogecoin tokens among rich investors, or so-called "whales."

The jump across Dogecoin's key metrics reflect investors' excitement about Elon Musk's Twitter acquisition on Oct. 27. Earlier this year, the billionaire entrepreneur had flirted with the idea of making Dogecoin a payment method to purchase the Twitter Blue subscription.

Bitcoin (BTC) asleep for up to a decade is waking up this week as BTC price action sees six-week highs.

Data from on-chain analytics firm Glassnode shows some of the oldest “dormant” bitcoins returning to circulation.

BTC trends out of hibernation

As BTC/USD stages something of a comeback in the second half of October, hodlers are changing their behavior after a year-long bear market.

According to Glassnode, the number of bitcoins previous stationary in their wallet for 7-10 years but not active again reached a one-month high on Oct. 29.

This is in fact the latest in a series of such highs, with the previous one seen on Oct. 1.

Bitcoin (BTC) attempted to retake $21,000 on Oct. 29 as weekend trading began on a strong footing.

Dollar lurks as BTC price rebounds

Data from Cointelegraph Markets Pro and TradingView followed BTC/USD as it rebounded overnight to local highs of $21,078 on Bitstamp — enough to clinch new six-week highs.

The pair had seen a consolidatory phase ensue after its first trip to the $21,000 mark, the first time it had traded above $21,000 since Sep. 13.

The subsequent retracement was modest in character, Bitcoin not even testing $20,000 before reversing higher once more.

The end of the Wall Street trading week saw BTC price action follow United States equities, the S&P 500 and Nasdaq Composite Index finishing Oct. 28 up 2.5% and 2.9%, respectively.

Welcome readers, and thanks for subscribing! The Altcoin Roundup newsletter is now authored by Cointelegraph’s resident newsletter writer Big Smokey. In the next few weeks, this newsletter will be renamed Crypto Market Musings, a weekly newsletter that provides ahead-of-the-curve analysis and tracks emerging trends in the crypto market. 

The publication date of the newsletter will remain the same, and the content will still place a heavy emphasis on the technical and fundamental analysis of cryptocurrencies from a more macro perspective in order to identify key shifts in investor sentiment and market structure. We hope you enjoy it!

Time to go long?

This week, Bitcoin’s (BTC) price has perked up, with a surge to $21,000 on Oct. 26. This led a handful of traders to proclaim that the bottom might be in or that BTC is entering the next phase of some technical structure like Wyckoff, a range break or some sort of support resistance flip.

Prior to getting all bullish and opening 10x longs, let’s dial back to a previous analysis to see if anything in Bitcoin’s market structure has changed and whether the recent spat of bullish momentum is indicative of a wider trend change.

When the last update was published on Sept. 30, Bitcoin was around $19,600, which is still within the bounds of the last 136 days of price action. At the time, I had identified bullish divergences on the weekly relative strength index (RSI) and moving average confluence divergence (MACD). There were also a handful of potential “bottoming” signals coming from multiple on-chain indicators, which were at multi-year lows.

The shift of the Ethereum (ETH) blockchain to a proof-of-stake (PoS) protocol opened new opportunities for developers and investors to explore, including the burning of Ether. Now, Ethereum PoS transactions are validated through staking rather than mining. 

Staking impacts the supply and price dynamics of Ether in ways that are different from mining. Staking is expected to create deflationary pressure on Ether as opposed to mining that induces inflationary pressure.

The increase in the total amount of funds locked in Ethereum contracts could also push its price up in the long term. This is because it affects one of the fundamental forces that determine its price, supply.

The percentage of newly issued Ether versus burned Ether has increased by 1,164.06 ETH since the merge. This means since the merge, almost all new minted supply has been burnt through the new PoS Ethereum burn mechanism which is expected to turn deflationary when the network sees an uptick in use.

According to Bitwise analyst Anais Rachel, “all the ETH issued since The Merge will have been taken out of circulation by the end of this week.”

On Oct. 28, NFT Steez, a bi-weekly Twitter Spaces hosted by Alyssa Expósito and Ray Salmond, met with Web3 content writer, Julie Plavnik to discuss the importance of self-sovereignty while building a digital identity in Web3. 

Plavnik references author Gavin Wood when describing Web3 and says that “communication” is a core tenant in the subsequent iteration of the internet. “Web3 is the communication of encrypted channels between decentralized identities,” Plavnik affirms.

According to Plavnik, the emerging concept of Web3 placed a magnifying glass on user data and ownership, especially concerning the creator economy. Plavnik describes the creator economy as a place with “no entry barriers or casting.”

During the show, Plavnik explores how users are coming around to the notion that they can potentially monetize from their individuality in Web3, but she also questions how they can maintain their self-sovereignty?

When speaking to Plavnik regarding how self-sovereignty is intertwined with Web3, there was no hesitation in explaining that the core tenet of Web3 is to uphold a self-sovereign identity — meaning decentralization is vital.

Bitcoin (BTC) climbed back to $20,500 at the Oct. 28 Wall Street open as United States equities sought a stronger finish to the week.

Bets that $20,000 will fail as support increase

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD capitalizing on renewed optimism as markets began trading.

The atmosphere was volatile after tech stocks suffered a major out-of-hours rout, with Bitcoin managing to avoid sustaining knock-on losses to the same extent.

At the time of writing, the S&P 500 and Nasdaq Composite Index were both up around 1.3%.

“In this current range bound phase after a prolonged downtrend,” popular trader CryptoYoddha summarized to Twitter followers.

Bitcoin (BTC) has been consolidating inside the $18,000–$20,000 price range since mid-June, pausing a strong bear market that began after the price peaked at $69,000 in November 2021.

Many analysts have looked at Bitcoin’s sideways trend as a sign of a potential market bottom, drawing comparisons from the cryptocurrency’s previous bear markets that show similar price behaviors preceding sharp bullish reversals.

Here are three strikingly similar trends that preceded past market bottoms.

2018’s sideways trend for BTC price

The 2018’s Bitcoin bear market serves as a major cue for a potential market bottom in 2022 if one looks at its eerily similar price trends and indicators.

One of the key indicators is Bitcoin’s 200-week exponential moving average (200-week EMA; the blue wave in the chart below). In 2018 and 2022, Bitcoin entered a long period of sideways consolidation after closing below its 200-week EMA.

Ether (ETH) is setting liquidation records this week as a comparatively modest price uptick reveals how bearish the market has become.

Data from on-chain analytics platform CryptoQuant confirmed that United States dollar-denominated short liquidations hit a new all-time high on Oct. 25.

Two days, half a billion dollars of ETH shorts

It is not just Bitcoin (BTC) causing the bears severe pain this week — data from exchanges also shows that Ethereum shorters have suffered heavy losses.

ETH/USD delivered fairly impressive gains on Oct. 25-26, rising from lows of $1,337 to highs of $1,593 on Bitstamp before retracing, according to data from Cointelegraph Markets Pro and TradingView.

While nothing unusual for crypto and for altcoins, in particular, the market changes triggered by the price action stood out.

Bitcoin (BTC) is decoupling from big tech as disappointing earnings fail to spark any major BTC price losses.

Economic data for Q3, 2022, saw heavy losses for some tech stocks, but BTC/USD avoided a chain reaction.

Bitcoin hodlers shrug off Q3 tech results

The largest cryptocurrency shed around $800 over Oct. 27, or 3.8%, after hitting its highest levels in six weeks.

At the time of writing, Bitcoin was still around $20,200, offering more consolidatory trading behavior than a major correction.

The same was not true of tech stocks — these were led by a dramatic 20% rout in Amazon during out-of-hours trading thanks to missed earnings targets. Amazon’s market cap sealed the biggest such post-close drop in history, at over $230 billion.

Bitcoin (BTC) consolidated gains on Oct. 27 as the highest levels in six weeks gave way to sideways action.

Bitcoin impresses with stability on GDP print

Data from Cointelegraph Markets Pro and TradingView showed BTC/USD circling $20,500 on Bitstamp after reaching local highs of $21,012 the day prior.

The largest cryptocurrency treaded water in line with United States equities at the Wall Street open, with the S&P 500 flat and the Nasdaq Composite Index down around 1% at the time of writing.

The U.S. dollar index (DXY), meanwhile, began to claw back losses on the day, providing a headwind to risk assets absent for much of the week. The DXY had seen its lowest levels since mid-September.

Ahead of a decision on interest rates by the Federal Reserve, gross domestic product (GDP) data showed a rebound for the U.S. economy in Q3.