Market veteran Benjamin Cowen highlights Ethereum cyclical breakdown patterns in 2016 and 2019, predicting a repetition in Q4 2024.
He recently shared Ethereum’s ETH/USD monthly candles showing similar behavior, with a breakdown against Bitcoin (ETH/BTC) happening a third time, in similar circumstances as 2016 and 2019.
Ultimately, the question remains: will ETH/USD fall further to align with history?
Historical ETH/BTC Breakdowns
According to Cowen’s chart, in Q4 2016, Ethereum experienced its first major ETH/BTC breakdown, followed by a drop in ETH/USD the following months.
This move coincided with Ethereum breaking through a green regression curve, which notably acted as a strong support. Following this decline in Q4 and a break below the regression curve, Ethereum resumed upward momentum in the following months.
#ETH / #USD monthly candles still tracking 2016 perfectly.
In 2019 (also a year #ETH / #BTC broke down), October was slightly green, but Nov/Dec were still red. https://t.co/XA2NvOmCGn pic.twitter.com/OI9Z1vBoRq
— Benjamin Cowen (@intocryptoverse) October 8, 2024
Similarly, Q4 2019 saw Ethereum undergo another ETH/BTC breakdown. After a brief recovery in October 2019, represented by a green candle, the cryptocurrency faced two red months in November and December, indicating further downside.
This pattern mirrors Ethereum’s movement below the regression curve, after which a recovery was seen in the following months, particularly the first quarter of 2020.
Potential Breakdown in Q4 2024
Looking ahead, the analysis suggests Ethereum has already experienced the historical ETH/BTC breakdown. Ethereum is currently tracking closely to the logarithmic regression band, and a slump could occur if ETH/USD drops further. Similar to 2016 and 2019, a decline could follow before Ethereum rebounds in the subsequent months.
Ethereum’s monthly trends for 2024 have already displayed volatility. The year began with five consecutive green months from January through May. However, since June, the price has seen a series of red months, with October 2024 also shaping up to be a red month. This behavior echoes the patterns observed in previous breakdown periods.
Whale Movements Add to Bearish Sentiment
Adding to the bearish pressure, recent on-chain reports have seen large amounts of Ethereum being transferred to exchanges. A whale who participated in Ethereum’s ICO has been actively moving ETH, recently transferring 5,000 ETH (valued at $12.22 million) to Kraken.
This sale is part of a larger trend, with the whale having sold 45,000 ETH over the past two weeks at an average price of $2,516. To date, the whale has sold 60,000 ETH for $149.68 million.
Additionally, the Ethereum Foundation transferred 2,500 ETH ($6.06 million) to the Bitstamp exchange in two transactions. This activity has sparked speculation that further sales may occur, particularly as Ethereum continues to face downward pressure in Q4 2024.
