BTC and ETH Trends Diverge: Crypto Investors Brace for ‘The May Effect’

Following Bitcoin’s upward trend, Ethereum failed to break its local high after the correction on 17 April. On 22 April, the bulls pushed Bitcoin to new highs and closed the evening session with a doji candle amid a sell-off in ETH.

At the end of April, the divergence between BTC and ETH stood at 8%, indicating a high probability of an altcoin sell-off in May.

The traditional seasonal sell-off in the stock market known as “Sell in May and go away” could also affect cryptocurrencies, given that they are riskier assets. The danger lies in the fact that BTC and ETH failed to reach key levels of $80k and $2.5k respectively. This directly indicates the weakness of the bulls and will reduce the number of buyers.

At the same time, analysts have observed an outflow of ETH from exchange wallets. Short-term holders are taking profits, while long-term holders continue to accumulate assets. ETH ETFs are also seeing an inflow of funds.