- The positive reading of the bullish and bearish indicator suggests that the price may rise.
- Ethereum’s network was overvalued and could hamper recovery potential.
The price of Ethereum (ETH) may have fallen by 7.30% in the last 24 hours, but the evaluation of a key indicator suggests that the decline could end soon.
The indicator discussed here is the Bulls And Bears metric provided by IntoTheBlock. This metric can be measured in addresses or volume.
However, the focus is usually on large buyers or sellers because they have a large influence on price movements.
The 1% want to keep the faith
A negative net result from the Bulls and Bears indicator suggests more large sell orders than buys. In this case, the price of the asset concerned could decrease.
But for Ethereum, the data showed the reading was positive, indicating bullish confidence in the price trend. If this metric maintains its position over the coming days, ETH could then reach $3,100.
Source: In the block
However, failure to maintain the status quo or improve it could cause the altcoin price to drop below $2,800. When AMBCrypto reviewed Ethereum’s STH-NUPL, we observed that market participants did not have much confidence in the cryptocurrency.
STH-NUPL stands for Short Term Holder — Unrealized Net Profit/Loss. With this metric, we can get an idea of investor behavior in the short term.
Investors are panicking, but ETH could help them
Based on our analysis, ETH’s disappointing price action has changed investor sentiment towards the coin. In March, the indicator was in the region of optimism (yellow).
At this point, holders were confident in the price action of ETH. But as of this writing, this figure has reached the capitulation region (red), indicating that market participants are afraid.
Source: Glassnode
However, fear can serve as a driving force for a rebound. If STH-NUPL continues to fall, the price of ETH could also fall.
Subsequently, a reversal could occur, as intense fear could trigger a tougher rally if buying pressure increases.
In this case, Ethereum could target a rise towards $3,500. Besides this metric, AMBCrypto found another indicator suggesting that ETH could recover soon.
This time we turned to dormant traffic. According to Santiment on-chain data, the 90-day dormant circulation had fallen to 9,246.
If the metric increases, it means that coins that have not moved for a long time are starting to change portfolios. Sometimes that means the old guys are selling.
Source: Santiment
So the recent drop implied that long-term Ethereum investors were not selling as much as around May 7-8.
Read Ethereum (ETH) Price Prediction 2024-25
However, the network value-to-transaction (NVT) ratio suggests that ETH could still be overvalued. Low NVT values suggest undervaluation.
But for Ethereum, the metric has increased, indicating that the network is overvalued relative to transactions.
News Source : ambcrypto.com
Gn bussni
