3 Major Metrics To Watch Out For That Can Impact Ethereum Prices
April 22 2024 - 12:00PM
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The crypto market has been plagued with increased volatility
lately, with the second largest crypto token by market cap,
Ethereum (ETH), not exempt. This has made it harder to determine
Ethereum’s future trajectory. However, certain metrics indicate
what direction ETH’s price could head in when this volatility
subsides. Ethereum Investors Are Bullish Data from Coinglass
shows that most Ethereum investors and traders are still bullish on
the crypto token despite recent fluctuating prices. Specifically,
most of these traders have continued to open long positions on
Ethereum, meaning they are betting on it experiencing significant
moves to the upside in the long run. Related Reading: Battle
For The Halving Block: Bitcoin Users Spend Record $2.4 Million On
Block 840,000 The bullish sentiment towards Ethereum is highlighted
by a trader who, having lost $4.5 million while longing ETH, still
opened another long position on the second-largest crypto token.
This crypto whale went as far as borrowing 17.3 million USDT from
Compound just to increase their position on Ethereum. These
investors’ bullishness on Ethereum is even more commendable,
considering that the bulls have suffered the most from ETH’s high
volatility. Data from Coinglass shows that over $16 million in long
positions have been liquidated in the last 24 hours, compared to
the $10 million short positions that have liquidated during this
period. Meanwhile, data from the market intelligence platform
IntoTheBlock shows that Ethereum’s Market Value to Realized Value
(MVRV) ratio has dropped, indicating that many Ethereum holders are
not yet in profit. This could be bullish for ETH’s price as these
holders will likely hold in anticipation of further upward price
action, thereby providing support against any potential price
declines. Making A Case For The Bears While the activity in
the derivates market and Ethereum’s MVRV ratio paint a bullish
outlook for the crypto token, Ethereum’s network growth suggests
that ETH could still experience further price declines. Data from
Santiment shows that the rate at which new users enter the Ethereum
ecosystem has slowed recently. Related Reading: Were Bitcoin
Miners Behind The BTC Price Crash Below $60,000? This declining
network growth is also evident in a recent Bitcoinist report, which
noted that Ethereum fees have dropped to their lowest since
January. Ethereum fees are known to skyrocket when there is
increased activity on the network. Therefore, low fees mean fewer
new users are currently transacting on the network or even holding
the ETH token at all. However, the silver lining is that data
from Santiment also shows an increase in velocity, which suggests
that existing users on the network are actively trading and
injecting more liquidity into the Ethereum ecosystem. This factor
could also contribute to potential price surges for the ETH
token. At the time of writing, Ethereum is trading at around
$3,200, which is up in the last 24 hours, according to data from
CoinMarketCap. ETH bears pull price below $3,200 | Source:
ETHUSD on Tradingview.com Featured image from Token Information,
chart from Tradingview.com
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