ETH: Following the trend down but not up; my short logic and why ETH is a more compelling short than BTC.

June has seen ETH's price action look worse than BTC's. At the start of June, ETH was still hovering around $1988, but now it's dropped to about $1690, suffering a deeper decline than BTC. If you closely compare BTC and ETH's movements, you'll notice a fascinating trend: when BTC rebounds, ETH barely budges, but when BTC drops, ETH plunges faster than anything else. This is a classic sign of a weak coin, and it's the core reason behind my decision to short ETH.

Let me break down my trading moves. I opened a short position on ETH two days later than BTC. I jumped in on June 4th when ETH broke through the $1900 support level, entering at market price around $1880. To be honest, ETH was stuck in the $1900 to $2000 range for quite a while, and it made several attempts to break the $2000 barrier at the end of May but got pushed down hard by the 200-day EMA. I figured that once $1900 gave way, there would be more downside potential compared to BTC.

From a technical perspective, the daily structure of ETH is way worse than BTC. The 200-day moving average has been turning down since June 7, indicating that the larger trend is weakening. While there’s a short-term signal of a 50MA bounce on the 4H chart, it’s just a minor correction and doesn’t change the overall bearish outlook. More importantly, the 4H RSI has shown a clear divergence in the last 14 candlesticks—price is bouncing but RSI isn’t making new highs, which is a classic weak rebound signal and suggests another drop is imminent.

After I shorted at 1880, ETH barely gave any bounce opportunities and has been sliding down. There was a brief spike on June 8 when BTC bounced, and ETH followed suit, but the move was much smaller and didn’t even touch 1900 before dropping again. This further solidified my confidence in holding my short position.

Currently, ETH is oscillating around 1690, and I'm still holding my short position without scaling down like BTC. My reasons are threefold: first, the ETH/BTC exchange rate is still weakening, indicating funds are flowing out of ETH into BTC; second, on-chain activity data for ETH hasn’t improved, with gas fees lingering at low levels, showing a lack of strong on-chain narratives; third, the 200-day moving average has clearly turned bearish, and as long as the price remains below this line, I see no reason to flip long.

I’ve set my target around 1600 USD, which is a dense trading zone from March this year and should provide some support. If the price breaks below 1600 with volume, I’ll consider holding on to target 1500. My stop-loss is set above 1950; if it breaks that level, I’ll take my losses and exit.

Just to clarify, my shorting of ETH isn’t because I don’t believe in Ethereum’s long-term value—technologically, ETH is still the king of public chains. However, in the current market environment, ETH is facing more selling pressure than BTC and lacks new narrative drivers. At this stage, going with the trend is much more practical than stubbornly holding.

In summary: The logic behind my short position on ETH is a weak asset coupled with a larger bearish trend and patience in holding. I won’t add or reduce positions until the market direction changes; I’ll let my profits run.