Ethereum Market Brace for Intense Volatility and Unexpected Moves

By: cointurk|2025/05/05 19:15:58
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In the cryptocurrency market, traders have been closely watching the ETH/BTC ratio, which has remained calm for days. As the width of the trading band narrows to historically low levels, the countdown to a potential volatility explosion begins. The Bollinger Bands have compressed this much for the first time since June 2020, and the direction in which the price will jump remains unknown. Accompanying this, the Ethereum $ 1,820 Pectra upgrade is set to expand the network’s capacity, further fueling expectations. Mounting Pressure on ETH/BTC Ratio TradingView data indicates that the upper-lower benchmarks around the 20-day simple moving average have narrowed as much as two standard deviations. Such a narrow band signals a rare moment when the price is “holding its breath” and typically triggers sharp breakouts. Rather than predicting the direction of the first move, analysts are focusing on the intensity of the move, as historical data shows that volatility tends to spike suddenly and sharply following such compressions. Some market participants anticipate a mini jump in favor of Bitcoin $ 94,456 , while those betting on Ethereum argue the opposite. Regardless of the chosen direction, liquidity hunters are likely to amplify volumes, causing positions to start and stop. Experienced traders already prefer prioritizing risk management by reducing leverage ratios. Pectra Update and Network Impact The Ethereum Pectra update fundamentally alters both the transaction capacity and validation limits of the blockchain. Raising the maximum amount of stakeable ETH from 32 to 2,048 could allow large pools to benefit from economies of scale. Meanwhile, increasing the number of “blob” data units per block will lay the groundwork for Layer-2 networks to operate more efficiently by reducing costs. Analytics firm Nansen suggests that the upgrade could trigger a new wave of traffic in the DeFi, NFT , and blockchain-based gaming ecosystems. The increased data capacity on the network, combined with the sharp band narrowing, might open the door to upward surprises in favor of Ethereum. However, since the full effect of the upgrade will take time to reflect in market pricing, initial reactions are likely to form under the shadow of high volatility.

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