Analysis: ETH/BTC Continues to Weaken, Breaks Key Moving Average; Analyst Warns of Potential 40% Downside

Odaily News Over the past year, the ETH/BTC trading pair has cumulatively fallen by more than 35%, with the market structure continuously weakening, raising concerns about further downside risks. Analysts point out that the ETH/BTC trend remains suppressed by a multi-year descending trendline, a structure that has repeatedly capped rebounds since 2022 and was accompanied by a nearly 70% correction during the 2024–2025 market cycle.

Currently, after attempting a rebound in August 2025 to the confluence zone of the 0.382 Fibonacci retracement level and the 50-month moving average, ETH/BTC was rejected and has subsequently broken below support at the 20-month moving average, indicating sustained selling pressure dominance. Technical models suggest that if this weakness persists, the next key support level could be around 0.0176 BTC, representing approximately 40% downside from current levels and approaching the cycle low area of 2020.

On-chain data shows that ETH reserves on Binance have continued to rise, reaching approximately 3.62 million coins as of May, accounting for about 24.6% of the total exchange holdings across the network, signaling increased potential selling pressure. In contrast, Bitcoin exchange reserves have continued to decline, reflecting tightening BTC liquidity and stronger holding sentiment.

The analysis suggests that this divergence in data reinforces ETH's relatively weaker market structure. Meanwhile, at the narrative level, the "ultra-sound money" narrative surrounding Ethereum has cooled off, while Bitcoin continues to benefit from institutional allocation and corporate treasury demand, placing ETH under pressure from both capital flows and market narrative. (Cointelegraph)