Ethereum poised to 50% surge this year against Bitcoin — Fractal analysis

Ethereum's native token, Ether ( ETH ), will likely explode by over 50% versus its top-ranking rival, Bitcoin ( BTC ), in the coming months, according to a technical setup called the inverse-head-and-shoulders (IHS).

ETH/BTC breakout setup resembles 2021's 140% surge

Notably, an IHS pattern is characterized by the formation of three troughs below a common neckline resistance, such that the middle trough (head) comes to be deeper than the other two troughs (shoulders), which are roughly of the same length.

In a "perfect" scenario, an IHS pattern resolves when the price breaks above the neckline resistance after the formation of the right shoulder. In doing so, the price rises by as much as the maximum distance between the head's lowest point and the neckline resistance.

As of June 17, the ETH/BTC pair seesawed after forming what appears to be the head of its IHS pattern. Thus, it still awaits an extended run-up toward the common neckline resistance level at around 0.061 BTC.

Afterward, the pair may experience modest pullback and recovery to retest the neckline, thus completing the IHS pattern formation.

Overall, a successful breakout above the neckline—accompanying a rise in trading volumes—will bring ETH/BTC's upside target to around $0.084 by the year's end, up over 50% from the current price levels.

Analyst Wolf anticipates an IHS breakout scenario in the coming months due to its similarities with a giant IH breakout pattern from the 2019-2021 period. The latter resulted in a 140% price surge following a decisive breakout in April 2021.

Bitcoin halving fractal boosts ETH/BTC chances

ETH/BTC's bullish outlook for 2024 gains additional momentum from its historical post- Bitcoin halving price behavior.

For example, the pair surged over 330% following the third Bitcoin halving in May 2020 and rallied over 900% after the second Bitcoin halving in July 2016. It remained within a large triangle pattern in both instances, as illustrated below.

ETH/BTC has been consolidating sideways since the fourth Bitcoin halving in April 2024 , holding above the lower trendline of its triangle range while eyeing a rally toward the upper trendline at around 0.062 BTC, up by about 20% from the current price levels.

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Interestingly, the upside target aligns with the IHS neckline resistance, as mentioned above. Thereby, fluctuating inside the triangle range will likely enable ETH/BTC to complete its IHS formation, leading to an eventual technical breakout if the pattern plays out as intended.

From a fundamental perspective, the launch of spot Ether exchange-traded funds (ETF)—possibly by July 2 , according to Bloomberg analysts—may trigger the technically bullish scenarios discussed above.

This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.