Key On-Chain Metrics Bursts Myth, ETH Price Rally Ahead?

With Ethereum (ETH) showing major underperformance with the rest of the crypto market, and the ETH/BTC pair hitting multi-year lows, there’s a common perception building up that ‘Ethereum is dead’. However, based on some on-chain metrics, market analysts have been bursting this myth while expecting an ETH price surge ahead.

Analysts Defend Ethereum Against Market Pessimism

As the chorus grows in the market that Solana is better than Ethereum, several market analysts have come to defend the world’s largest altcoin. As per the 10X Research report, the ETH weekly stochastic indicators show the formation of a bottom for the altcoin.

After dropping to less than 10%, this indicator is showing trend reversal again. Historically, whenever this happened, it suggests the formation of the Ethereum price bottom.

On the other hand, the daily trading volume for ETH suggests that the altcoin is nowhere close to being dead. The daily trading volume for ETH is close to $12.2 billion while that of Bitcoin is $21 billion. On the other hand, the daily trading volume of Solana (SOL) is $2.7 billion. As ETH clocks higher trading volumes than SOL, it shows that the world’s largest altcoin continues to be in demand.

Besides, Ethereum is also making higher highs and higher lows on the technical chart. Popular crypto analyst Income Sharks noted:

“Love that everyone says it’s over at the lows. Still making higher highs and higher lows. Supertrend still bullish. No one was saying these things when it was at $4k. Remind me again about what happened when $SOL was dead at $10?”

What Can Lead to ETH Price Revival Ahead?

On the weekly chart, the ETH price is trading 7.64% down while managing to hold the support levels of $2,500. Market analysts view ETH among three potential altcoins to rally ahead this week.

Ethereum enthusiast VivekVentures points out three reasons why the altcoin will continue to rally ahead.

1. Fundamental: Despite all the pessimism, institutional players are choosing Ethereum to build and expand their products. Asset manager BlackRock launched its first tokenized fund on Ethereum. Similarly, financial giant Visa announced asset tokenization on the platform.
   WisdomTree is deploying money market funds on Ethereum while Coinbase, Sony, and Kraken are all developing Layer 2 solutions on Ethereum.
2. Psychological: Vivek explains that ETH appears to be out of favor with many expecting the altcoin’s “demise”. Thus, ETH is either on a decline or is facing a solid contrarian opportunity, and he believes it’s the latter.
3. Technical: For all these years, Ethereum has been competing with Bitcoin while the ETH/BTC pair has been struggling since the Merge. VivekVentures writes that if we believe in market cycles, we saw ETH/BTC stagnate similarly in 2020, only to rally and triple in the first half of 2021.

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Bhushan Akolkar

Bhushan is a FinTech enthusiast with a keen understanding of financial markets. His interest in economics and finance has led him to focus on emerging Blockchain technology and cryptocurrency markets. He is committed to continuous learning and stays motivated by sharing the knowledge he acquires. In his free time, Bhushan enjoys reading thriller fiction novels and occasionally explores his culinary skills.

Disclaimer: The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.