Ethereum (CRYPTO: ETH) is showing relative strength against Bitcoin (CRYPTO: BTC), but analysts warn the trend is temporary, with a rebound likely only after a seasonal pullback.
What Happened: In a podcast update on Wednesday, Benjamin Cowen highlighted the ETH/BTC ratio at 0.038, resembling August–September 2020 bottoming patterns.
He expects a local peak near 0.04 by late August before a correction.
The April 2025 lows aligned with the logarithmic regression band, historically signaling major ETH/BTC bottoms.
The upcoming correction is expected to be driven by Bitcoin dominance seasonality, which has historically reversed in September (2017–2021).
Despite possible Fed rate cuts, monetary policy remains above neutral, limiting altcoin upside, similar to September 2024 when rate cuts failed to sustain rallies.
Technical indicators, including daily RSI on BTC dominance, show bullish divergence, supporting a potential ETH/BTC retrace.
Cowen cautions that ETH/BTC has formed higher lows but lower highs over cycles, with historical peaks declining from 0.15 (2017) to 0.088 (2021), highlighting Bitcoin's continued supremacy.
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What's Next: Looking ahead, Cowen predicts ETH/BTC could hit a local top by late August/early September, then retrace to a higher low before another potential upward move.
Bitcoin is expected to test bull market support around $110,000–$115,000 in September, driving rotation from altcoins back to BTC.
The ETH/BTC rebound may extend into November–December, mirroring 2017 patterns, with potential acceleration after the seasonal correction.
Cowen concluded that Ethereum's current strength against Bitcoin is cyclical, not structural. After a late-August rally and September correction, a Q4 rebound remains possible.
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