Ethereum finally rose after breaking through a critical resistance level that had kept the price low since early August. The move changed market sentiment as many investors and analysts had previously doubted ETH’s potential in the current cycle, expecting it to lag behind. However, Ethereum’s recent strength is starting to change these prospects.

Prominent analyst and investor Ali Martinez recently shared insights indicating that while Ethereum’s momentum is increasing, the long-awaited “Altseason” has not yet arrived.

According to Martinez, Bitcoin tends to outperform Ethereum and other altcoins at this point in the cycle – a common pattern as BTC often leads market gains. This active could provide a strategic opportunity for investors looking to enter ETH and other altcoins before broader market euphoria begins.

As Ethereum gains popularity, market participants are paying attention to further confirmation of its breakout, with many speculating that as Bitcoin’s dominance cools, capital may flow more aggressively into altcoins.

Ethereum Awakening

Ethereum is enjoying a remarkable comeback, rising over 22% in just two days of mighty growth. While these results are impressive, key data highlights that Bitcoin continues to lead the market, slightly dwarfing Ethereum’s gains. For savvy investors, this could present an excellent opportunity to start accumulating Ethereum and selecting altcoins before they potentially surge in the next phase of the cycle.

Ali Martinez, distinguished analyst, recently shared a Glassnode chart revealing insights on the “Bitcoin Altseason Indicator.” This tool compares net capital flows between Bitcoin and Ethereum, showing that while Ethereum is rising, Bitcoin’s net capital change is currently outpacing it.

This trend confirms that the Altseason – in which altcoins outperform Bitcoin – has not yet begun. Martinez points out that this active is typical of this stage, with Bitcoin typically leading in the early growth phase and Ethereum following shortly thereafter.

Historically, Altseason has often occurred when Bitcoin’s price momentum stabilizes as capital flows from Bitcoin to high-potential altcoins. Many savvy investors find this part of the cycle to be the ideal time to accumulate ETH and mighty altcoins at attractive prices before the broader market shifts its attention.

The relationship between BTC and ETH performance will be closely watched in the coming weeks, which may result in a change in market sentiment and capital distribution.

ETH technical view

Ethereum recently broke above critical resistance at $2,820, breaking above the 200-day exponential moving average (EMA) and touching the 200-day moving average (MA) at $2,955. This represents a significant upward move as ETH has been trading below these levels since early August, and the recovery of these indicators is seen as a positive sign for further gains.

For the uptrend to continue, ETH must break above and stay above the daily MA at $2,955, solidifying this breakout as a base for the next phase of the uptrend. However, some analysts suggest that a period of consolidation just below the 200 MA could be beneficial, allowing ETH to gather strength for a more sustained rally. This break could ease the growing euphoria and avoid undue prolongation of negotiations in the compact term.

As market sentiment becomes more positive, many investors are keeping a close eye on this level. Staying above these critical indicators would give bulls more control, potentially setting Ethereum up for a more solid recovery as it reaches recent highs.

Featured image from Dall-E, chart from TradingView