Crypto News – Solana Ether Ratio Plummets to Lowest in 3 Months, Expert Predicts Continued Decline

Crypto News – Solana Ether Ratio Dips to 3-Month Lows, Analysts Warn of Prolonged Downtrend

Crypto News – Recently, CoinDesk explored the potential impact of speculation surrounding a spot Ether (ETH) ETF, suggesting it could trigger a shift of capital away from altcoins like Solana’s SOL token and toward Ether. This prediction appears to have manifested in the market dynamics over the past month.

Bearish Momentum in SOL/ETH Pair

The ratio between SOL and ETH prices has dropped approximately 35% to 0.038 on Binance, marking its lowest point since March 13, as reported by TradingView. Analyst Josh Olszewicz suggests that this decline has ushered in a bearish sentiment, with further losses looming.

Technical Analysis: Bearish Signals

Olszewicz highlights key bearish indicators on the technical chart, particularly the breach of the Ichimoku cloud support. The Ichimoku Cloud, developed by Japanese journalist Goichi Hosada, comprises five lines and is used to identify broader trends. A crossover below the cloud, as observed in SOL/ETH’s case, typically signals a bearish trend shift.

Failure of Bullish Patterns

Additionally, the SOL/ETH chart indicates a failure of the ascending triangle pattern, typically considered bullish. This pattern, characterized by a rising support line and horizontal resistance line, usually suggests a continuation of an uptrend. However, the pair’s descent below the ascending trendline support line signals a reversal to a bearish trend.

Potential Catalysts for Temporary Recovery

While the prevailing trend favors further declines, temporary recovery rallies may occur if there are outflows from the Grayscale Ethereum Trust, according to Olszewicz. Similar to the aftermath of spot Bitcoin ETF debuts in the U.S., which saw substantial outflows from the Grayscale Bitcoin Trust ETF, a similar dynamic might unfold in the ether market post the anticipated debut of spot ETFs in July.

Prospects of SOL Amid ETF Speculation

Olszewicz suggests that SOL may attract interest if BlackRock pursues an ETF tied to SOL, although he deems it unlikely. He outlines two key factors to monitor: ETHE outflows potentially boosting the SOL/ETH pair temporarily and the possibility of a Larry SOL ETF application, which is considered improbable. If the ETH ETF proves successful, Olszewicz anticipates a continued decline in the SOL/ETH pair.

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