A closely followed crypto strategist is warning that Ethereum (ETH) could follow a similar 2022 pattern and soon plummet in value.
The analyst says that ETH may be consolidating in a long upward channel and could soon revisit the bottom of it. Such a drop would put ETH at about $400, according to Bennett’s chart.
“Imagine if the last 10 months have been nothing more than mid-trend consolidation for ETH. Few believed this scenario last year, and fewer believe it now. Not saying it will happen, but don’t rule it out.”
Bennett’s analysis is an update on a previous call from last year when he first suggested a drop to between $300 and $400 for ETH.
The analyst also updates his outlook on Bitcoin (BTC), and says the king crypto’s latest rally has run out of gas. He says a drop off in trading volume suggests that it’s unlikely Bitcoin will continue its upward trajectory in the near term to hit $50,000, as some predict.
“I’d love to know how so many believe Bitcoin will reach $100,000 or even $50,000 this year when volume looks like this. A rally on decreasing volume = exhaustion.”
Bitcoin is trading for $28,542 at time of writing, up 1.3% in the past 24 hours.
The trader notes that the US Dollar Index (DXY) has, for the first time since March, closed the day at a higher value than the previous day, indicating USD is strengthening. The DXY pits the US dollar against a basket of other major foreign currencies, and is often inversely correlated with risk assets like crypto.
“DXY, first higher high since early March.”
