Ethereum price has crossed above the symmetrical triangle and is comfortably floating above a stable support area with no signs of weakness. Despite the recent flash crash, downside risk to ETH also appears to be capped due to a plethora of footholds. Thus, investors should not give up the smart contract token reaching significant psychological levels.
On-chain stats reveal optimism?
The price of Ethereum crashed about 12% when Bitcoin made a reversal on March 6. This sudden downtrend caused many altcoins to move south as well. However, for ETH, the on-chain stats favor a bullish outlook.
The most bullish index for the short-term outlook is on-chain volume and the recent uptrend. This statistic has seen higher highs since March 16, rising from 17.19 billion to 24.25 billion on April 7.
Despite the recent drop in the price of Ethereum, the volume seems to be increasing. So this indicates that the market participants could buy the dips.
The supply of ETH on exchanges appears to be steadily declining despite a small surge in February. Currently, the amount of ETH held on centralized entities has reached 15.08 million, indicating a 6.1% decline or nearly a million outflow since March 1.
This drop signals that investors are growing more confident in Ethereum and expecting a bullish performance from the price in the near future.
While the on-chain volume and supply on exchanges indicate that investors are bullish, the 30-day market value to realized value (MVRV) mode shows that a sell-off is less likely. This indicator is used to assess the average gain/loss of investors who have purchased ETH tokens in the past month.
A reading of less than -10% indicates that short term holders are selling at a loss and this is usually where long term holders step in to accumulate as the risk of a massive flash crash is close to zero. For this reason, a value below -10% is often referred to as an “opportunity zone” because the risk of a sell-off is lower.
While the 30-day MVRV hit 16% on March 29, it has since fallen to near zero. This indicates that short-term holders have made a profit.
Therefore, these three on-chain stats suggest that a bullish regime is waiting for the price of Ethereum and the sell-off can be done for now.
This post Ethereum’s story of increasing volume and decreasing price; this is what it means
was published first on https://ambcrypto.com/ethereums-tale-of-increasing-volume-and-decreasing-price-heres-what-it-implies/