As the ETH / BTC trading pair hits new highs, ETH has become a tool to “hedge” the fall in BTC.

On December 4, ETHereum's traditional token, Ether (ETH), fell along with other cryptocurrencies. However, the decline did not stop ETH / BTC from reaching a three-year high, making BTC the world's largest cryptocurrency in terms of market value.

The ETH / BTC exchange rate rose over 11.50%, reaching 0.0835 BTC for the first time since May 2018. The rate of return for this currency pair of around 15% has fallen in the ETH / USD trading pair price on December 4th. At the time, the cryptocurrency market as a whole fell and Bitcoin fell 21% in intraday trading.

The rise of ETH as depicted in Hedge BTC's Plunge

The drop in ETH is big, but the drop is also small as the ETH / BTC currency pair hit a three-year high on BTC in USD terms. At the same time, some analysts believe that during the December 4 plunge, investors started using the second largest cryptocurrency as a tool to hedge BTC risk. .

Independent Crypto market analyst Birb said in a Dec. 4 tweet that "it looks like investors are starting to use ETH as a BTC hedging instrument." The 200-line moving average (orange curve) has been inverted as support.

Bitpanda's head of commodities Luke Enzersdorfer-Konrad noted that the ETH / BTC closing price in November was the highest in 45 months.

“Ethereum has outperformed Bitcoin this year… it increased its market share to 22%. Why an increase?”

technological perspectives

In a recent Cointelegraph report, the support structure, known as the ascending triangle, indicated the possibility of ETH continuing its uptrend.

On December 4th, the ETH / BTC currency pair affected the rise of the triangle with a slight increase in volume. Ideally, the movement of the currency pair should continue for a length equal to the maximum of the midline of the upper midline of the triangle.

As can be seen, from the break point near 0.077 BTC, the rise in the triangle target will make the target close to 0.1 BTC.