Can This Drive A New ATH Above $5,000?
The worst looks to be over for Ethereum (ETH), as certain metrics suggest that the bottom is already in for the second-largest crypto by market cap. Based on this, ETH looks to be headed for a new all-time high (ATH), surging past its current ATH of $4,800.
Ethereum MVRV Shows Bottom Is In
Data from the onchain analytics platform Glassnode shows that Ethereum’s market value to realized value (MVRV) lowest pricing level is at $1,687, which suggests that the bottom is already in for the crypto token. These MVRV pricing levels highlight how low or high a token will likely reach in a market cycle based on unrealized loss or unrealized profits.
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As such, Ethereum is unlikely to see a drop below the $1,687 price level and instead looks headed for its market top. It is worth mentioning that Ethereum dropped to as low as $2,200 following the market crash on August 5. That price level is close to the $2,109 MVRV pricing band, which Glassnode highlighted, further proving that the crypto has bottomed.
Meanwhile, the shift to accumulation among Ethereum investors indicates that they are no longer looking to sell their assets but are holding in anticipation of higher prices. Data from Glassnode shows that the percentage of ETH’s supply held on exchanges has drastically declined to under 10%. This is significant as it potentially reduces the selling pressure on Ethereum and primes it for a massive rally as long as investors continue to hold.
Data from Glassnode shows that Ethereum could rise above $5,000 and reach as high as $6,759, which is the highest MVRV pricing level for the crypto at the moment. That price level could mark a market top for Ethereum in this bull run, although crypto analysts like Tyler Durden have predicted that the crypto could still reach $10,000.
Other Metrics That Support An Imminent Price Rally For ETH
A recent blog post on the onchain analytics platform Cryptoquant highlighted two metrics that show that Ethereum is gearing up for its next leg up. One is the Taker Buy-Sell Ration, which calculates the ratio of Ethereum buyers to sellers. This metric is said to be positive again as Ethereum bulls are regaining strength and suppressing any selling pressure from the bears.
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Ethereum’s open interest (OI) is again rising after dropping to $7 billion following the August 5 market crash. Data from Coinglass shows that the OI is currently at 10.81 billion, indicating that leveraged players are returning to the scene. This is significant as trading volume in the derivatives market also greatly impacts ETH’s price.
At the time of writing, Ethereum is trading at around $2,590, down over 3% in the last 24 hours, according to data from CoinMarketCap.
Featured image created with Dall.E, chart from Tradingview.com
