Ethereum: What could go well if ETH really decouples from Bitcoin [BTC]

The king of altcoins has always shared a close correlation with Bitcoin. Needless to say, every movement of the king coin has had some impact on Ethereum. However, this dynamic is starting to change, and this could bode well for the second-generation cryptocurrency and its investors.

Ethereum goes beyond Bitcoin

In the past few weeks, the crypto market has fluctuated between bull and bear markets. Although Ethereum has made significant gains on a macro level, it has erased all of the losses it recorded in June.

With market conditions improving, ETH has also improved its standing, trading at $1,721 at press time. After its recent 8.1% rally, the altcoin was nearing a critical zone. This would set Ethereum up for a rally until the merger arrives on September 19th.

Ethereum price action | Source: TradingView – AMBCrypto

The Fibonacci retracement from its all-time high of $4,811 to lows of $880 has brought forward critical zones for Ethereum, and the altcoin is close to one of them. The 23.6% Fib level, which serves as a solid base/support for any rally, collapsed. In fact, at the $1,807 price level, ETH seemed very close to breaking through and flipping it into support.

The reason for this increase is twofold. The first is a lack of activity from investors as ETH holders have been HODLing for over a month. The rate at which the token is changing hands is declining, which is good since conducting transactions in such a volatile environment would inevitably result in losses.

Ethereum speed | Source: Santiment – AMBCrypto

As this did not happen, ETH managed to rally on the charts. Evidence of this can also be found in the grid’s gas charges.

The lack of circulation last week resulted in lower costs, which are expected to rise once the merger FOMO goes into effect.

Ethereum has seen a drop in fees | Source: Santiment – AMBCrypto

The second reason is the merge itself, which is bound to bring a tectonic shift to the second largest crypto network. As the date of the update approaches, so does the hype, which is why Ethereum’s growth is outpacing Bitcoin’s.

At ETH press time last year, BTC was valued at $41,000. Today it is struggling to surpass $24,000. Ergo, when ETH decouples from BTC, it will be in a much better position.

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