Ethereum faces potential 10% slide versus Bitcoin as double-top takes shape

Key takeaways

• ETH was changing hands around 0.03167 BTC, with its relative performance against Bitcoin losing ground.
• A double-top formation is emerging, marked by two highs in the 0.03344 BTC area.
• A daily close beneath the 0.03078 BTC neckline might lead to a drop of roughly 10%, targeting 0.0283 BTC.

Ethereum appears poised for additional weakness relative to Bitcoin, as a possible double-top pattern takes shape on the ETH/BTC daily chart.

On September 16, ether was trading near 0.03167 BTC after its latest upward move failed to hold. A combination of softer momentum, rising regulatory concerns, and a notable uptick in ETH deposits to Binance points to a cautious near-term outlook.

If the pair confirms a break below 0.03078 BTC, it could fall by approximately 10% toward 0.0283 BTC.

ETH/BTC double top hints at possible decline

The ETH/BTC chart shows two similar peaks around 0.03344 BTC, with the first taking shape in August and the second in September.

This setup resembles a double top, a bearish reversal pattern that occurs when buyers fail twice to push through the same resistance level.

The pattern's neckline is located near 0.03078 BTC. To confirm the bearish signal, Ethereum would need to post a firm daily close below that threshold.

Taking the pattern's height and subtracting it from the neckline gives a downside objective of roughly 0.0283 BTC. Hitting that level would mean a decline of about 10% from ether's current value against Bitcoin.

Ethereum momentum shows signs of cooling

The ETH/BTC Relative Strength Index has dipped toward 50 after earlier climbing above the overbought mark of 70.

While the RSI is still slightly above neutral, its pullback suggests that the momentum behind Ethereum's August-to-September rally is losing steam.

Ether continues to hold just above its 20-day exponential moving average, which sits at approximately 0.03162 BTC. A solid bounce off this moving average could delay or halt the bearish breakdown.

A decisive move above the two peaks at 0.03344 BTC would negate the double-top pattern and give ETH a more positive relative outlook.

The bearish technical picture emerged after the US Senate failed to advance the Digital Asset Market Clarity Act on September 15.

The procedural vote came in at 50 in favor and 49 against, but that fell short of the 60 votes needed to move the legislation forward. Senator Thom Tillis changed his procedural vote, leaving the door open for the measure to be reconsidered.

The failure triggered a broad cryptocurrency sell-off. Bitcoin dropped about 4% to around $75,900, and shares of major crypto firms such as Coinbase and Circle also declined.

Uncertainty around regulation can push traders toward Bitcoin and away from riskier assets like Ethereum. That could add pressure on the ETH/BTC pair and bring the 0.03078 BTC neckline back into focus.

Binance receives 709,400 ETH in a single day

Ethereum inflows to Binance have also climbed sharply, adding another possible source of selling pressure.

Around 709,400 ETH were transferred to the exchange on September 11, the largest single-day inflow since June, according to CryptoQuant. Several other recent sessions also saw inflows above 500,000 ETH, well above the usual levels seen in July and August.

Higher exchange inflows increase the amount of ETH readily available for trading. While moving tokens to an exchange does not always mean holders intend to sell, unusually large deposits can sometimes signal greater market supply and more volatility.

Those elevated inflows reinforce the cautious sentiment already driven by Ethereum's weakening relative momentum and the setback for the CLARITY Act.

ETH/BTC bulls need to protect 0.03078

The bearish outlook hinges on ETH/BTC closing decisively below the 0.03078 BTC neckline. Confirmation of that break could open the door to the measured target of 0.0283 BTC.

Still, support from the 20-day EMA near 0.03162 BTC might allow Ether to bounce. A rise above 0.03344 BTC would invalidate the double top and point to renewed Ethereum strength against Bitcoin.