A popular analyst is warning Ethereum (ETH) is facing another leg down while many other altcoins will lose a ton of their valuation.
In a new YouTube strategy session, crypto strategist Nicholas Merten tells his 512,000 subscribers that Ethereum is on a downtrend with the 200-week moving average continuing to act as resistance.
“Even though if we take a look at the ETH-to-BTC ratio, Ethereum has been holding up relatively neutral with where it’s been since May of 2021 against Bitcoin, it is still on a downtrend… We believe this chart is going to start declining very soon.
Ethereum is tracking well below its 200-day moving averages as well as its 200-week moving average. We have been tracking below this range since during the collapse of FTX back in November 2022. And ever since then, we’re repeating the same pattern we had back in June, where the 200-week moving average is starting to serve as resistance.”
He warns a relief rally is not sustainable unless Ethereum gets above the 200-week moving average and trades at 15% or 30% of its current value, between the price levels of about $1,470 and $1,668. At time of writing Ethereum is changing hands at $1,253.
“I want to make the case here today that any kind of relief rally or move up that we get up towards that range is not to be trifled with. I think it’s going to serve as resistance, not to mention because the 200-days are coming very close in that range, until we can get above that range make these indicators support, which to me would definitely be interesting, I remain bearish.”
Merten warns that other altcoins may collapse under the current market conditions, saying they are overvalued.
“When we talk about the altcoin reckoning, we’re talking about the broader crypto space where there’s a lot of false valuation and a lot of false hopes that a lot of these names are still going to be here in the next year or two…
If you’ve been here like I have been since 2016, 2017 actively investing and trading in crypto, you’ve been through a market cycle or two and you probably remember that a lot of the great altcoins that made up the leaderboard of the top-valued cryptos are no longer here. They are relics of the past. Lessons learned or lessons still not learned by a lot of investors. Unfortunately, a lot of the altcoins that are here today are not going to be here.”
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Source: https://dailyhodl.com/2023/01/04/analyst-nicholas-merten-warns-of-altcoin-cleansing-says-ethereum-eth-facing-another-leg-down/