After a key week for Ethereum, a technical candlestick pattern shows that ETH prices may be poised for a surge in the coming weeks and months.

Indicating events on a monthly chart, one analyst notes that the ETH/BTC ratio is reversing from its multi-year support trend line. Typically, the analyst continued, when prices bounce off this line, altcoin prices tend to react by trending higher.

ETH/BTC is rising from a key support trend line

ETH/BTC is a ratio closely monitored by technical analysts. Compares the performance of the first and second most valuable coins in the world.

Although Bitcoin has been stable for most of the last two years, the monthly chart clearly shows a downward channel, indicating an uptrend.

So far, there have been a series of higher lows. This suggests that bulls have succumbed to selling pressure over the years, keeping prices high.

Looking at the monthly chart, the bar will close powerful and bullish this month. This will create a two-bar bullish reversal pattern that could spur demand.

This will later lend a hand push ETH prices even higher. Still, the relatively lower trading volume, lower than in July 2022, suggests that attendance is not at historically high levels.

A bullish bar in June confirming this month’s raise may provide the basis for another raise. If this happens, it will mirror those of January 2021. Another 40% rally against Bitcoin could see ETH close above 0.08 BTC, pushing the coin towards 2017 highs.

Overall, Bitcoin was powerful. As of September 2022, BTC has outperformed ETH, erasing the gains of 2020 and 2021. As a result, a descending channel has formed, although this phase of lower lows has also seen relatively low levels of participation.

Technically, based on volume analysis, this is a bullish result for ETH. Still, a close above 0.08 BTC would be a powerful bullish sign. This could potentially lay the groundwork for cementing ETH, further narrowing BTC’s dominance.

Spot Ethereum ETFs to Boost Demand: Path to $4,900?

For years since the launch and final approval of spot Bitcoin Exchange Trade Funds (ETFs) in January, the digital asset has been the only asset recognized by the U.S. Securities and Exchange Commission (SEC).

Due to this advantage, the approval of the derivative product has made BTC the asset of choice for institutions. Wall Street players like Fidelity and BlackRock have been enabling BTC exposure through spot ETFs over the past four months, leading to billions being pumped into the asset.

However, this changed last week when the US SEC approved the listing of all Ethereum spot ETFs. ETH staking has been removed from revised files 19b-4.

Still, the fact that Ethereum is almost being explained is a huge boost for the network and platform. In response, ETH prices surged by as much as 30%, outperforming Bitcoin.

It is highly likely that ETH prices will continue to rise in the coming weeks. While it remains to be seen how it will be received, especially among investors, the coin, like BTC prices after mid-January 2024, will rise, perhaps surpassing $4,100 or even the all-time high of 2021.

Feature image from iStock, chart from TradingView