-
ETH is showing weakness in this market cycle.
-
“There may still be growth potential for ETH,” suggests CryptoQuant.
Ether (ETH), the Cryptocurrency of the Ethereum network, has reached levels not seen 6 months ago and would be gaining momentum to exceed $4,890, its all-time high.
This is suggested by a analysis from the on-chain data firm CryptoQuant, carried out by the recognized cryptocurrency market specialist Maartunn.
Based on on-chain metrics and historical patterns, the analyst highlights that there are three factors that could generate bullish momentum for the price of the digital currency of Ethereum. “There may still be growth potential for ETH,” he explains.
1- Accumulation directions
The first factor that the author mentions in his report is the increase in accumulation addresses, which are those that only receive funds and do not make withdrawals. This is considered a long-term bullish signal, since the assets remain in the hands of investors and thus the supply available in the market is reduced.
In this sense, the specialist highlights that, although the balance of ETH accumulation addresses is significantly lower than that of BTC, the growth dynamics in both assets are similar.
The current ether balance in accumulation addresses amounts to 19.5 million ETH, which is equivalent to $78 billion.
The blue line represents the growth of the balance in the ETH accumulation directions. Source: CryptoQuant
For its part, the management balance accumulated in the Bitcoin/” target=”_blank” rel=”noreferrer noopener”>coin created by Satoshi Nakamoto is 2.8 million BTC, an estimated value of $280 billion.
The blue line symbolizes the growth of the balance of BTC accumulation directions. Source: CryptoQuant.
Although the dollar value of BTC accumulation addresses is four times that of ETH, it must be taken into account that the market capitalization of ether is also four times smaller.
For the analyst, this indicates that, if these trends persist, ETH could trade higher in the short term. “In my opinion, the dynamics of ETH and BTC in accumulation directions are more or less the same. That increases the probability that ETH will also reach a new ATH,” he highlights.
2-Inflows into ETFs
For the specialist, the good performance that ether exchange-traded funds (ETFs) are having in the United States is another factor that could boost the price of the asset.
In his analysis, he highlights that last month several significant peaks were recorded, such as that of November 11, when receipts exceeded $1.1 billion. “These substantial inflows highlight strong buying pressure directed at the ETH ETF,” he notes.
Since its release on the market in July 2024, The 9 ether ETFs accumulate more than $1.56 billion.
Entries and exits in ether ETFs since their market launch. Source:SosoValue.
As CriptoNoticias has explained, the performance of the Spot ETF has a direct impact on the price of ETH. Due to their operation, the companies that manage these instruments must maintain the asset in their treasuries to support their actions. This reduces the amount of ETH available on the market.
By law of supply and demand, Ether purchases made by management companies tend to push its price upward.
3-Historical patterns
The analyst mentions that, according to historical patterns, ETH usually reaches its all-time high after BTC.
To illustrate his point, remember that during the 2021 bull run, which began in September 2020, BTC reached its ATH on March 13, 2021. “With an increase of 480% since the beginning of the cycle, while ETH Ethereum had risen a 427%”, he points out.
ETH’s peak occurred two months later, on May 12, 2021. “By then, ETH had risen 1,114%, significantly outperforming BTC in the same cycle. “This delayed rally in the price of ETH highlights the potential for further gains, similar to what was seen in the previous bull market,” he explains.
To reinforce his argument, he shares a graph in which it is seen that the performance of ether (orange line) was superior compared to that of BTC (blue line) in 2021.
Ether surpassed BTC in terms of percentage growth in 2021. Source: CryptoQuant.
Likewise, the author highlights that ether is “currently underperforming bitcoin in this cycle, suggesting a change in dynamics.”
Finally, Maartunn points out a weak point in this ether cycle: The sales volume has reached 400 million dollars, surpassing that of purchases in the average of the last 30 days. This is generating a bearish momentum in the price of the digital currency.
However, he clarifies: “This suggests that, although the current sales may seem worrying, they could be part of a cycle that allows ETH to recover and reach a new high later.”
In May 2021, in the same period as BTC’s peak, Significant sales volume of Ethereum coin observedas reflected in the following graph.
The blue line represents the ETH price, while the red bars indicate the sales volume, and the green bars reflect the purchase volume, on a 30-day average.
Ether surpassed BTC in terms of percentage growth in 2021. Source: CryptoQuant.
Although the chart indicates that there is currently strong selling pressure, potential future growth is not ruled out, especially if history repeats itself like in 2021.
Crypto Keynote USA
For the Latest Crypto News, Follow ©KeynoteUSA on Twitter Or Google News.
