Ethereum to underperform Bitcoin in a sell-off as ETH is capped at $2,500

Ethereum price sits on a precipice that it must hold for the next five days or it is likely to crash towards a new 30-day low.

Ethereum price holds on to final Ichimoku support at Senkou Span B

Ethereum price has one of the most looked-for-bearish Ichimoku setups developing on its daily chart: the Ideal Bearish Ichimoku Breakout. The conditions for this Ichimoku setup are:

1. Chikou Span below the Cloud.
2. Tenkan-Sen below the Kijun-Sen.
3. Future Span A below Future Span B.
4. Price below the Cloud.

All conditions save one is present on the Ethereum price chart – price below the Cloud. Buyers have persistently defended the $2,900 - $3,000 level for the past eight trading days. However, there are signs that $2,900 will soon fail as support. The final support level in the Ichimoku Kinko Hyo system is at $2,900, with zero remaining supportive Ichimoku levels until the Chikou Span intercepts Senkou Span B at $2,500.

The oscillators support a relatively quick move from $2,900 to $2,500. The Relative Strength Index has developed a bear flag with a breakout directly below the final oversold condition in a bull market (40). Likewise, the Composite Index also has a bear flag formation. The Optex Bands is the only oscillator with some possibility of support coming in, but it could still move lower as it is not yet in the lower extremes. Because of these oscillator conditions and the lack of support below $2,900, Ethereum price is likely to underperform Bitcoin in any upcoming sell-off.

ETH/USD Daily Ichimoku Chart

To invalidate this current bearish setup, buyers will need to defend the $2,900 level. If Ethereum price can maintain $2,900 until October 3^rd, the threshold bulls need to target to convert Ethereum into a new bullish expansion phase drops from a daily close at $4,000 to a close of $3,500.