Will These Ethereum On-Chain Metrics Affect ETH Price Rally?
Multiple on-chain indicators for Ethereum (ETH) suggest that a short-term price correction may be in store after the cryptocurrency surged 35% over the past 30 days. ETH recently hit the $4,000 mark, sparking concerns that it is overbought.
When the price reaches this key resistance level, indicators suggest that selling pressure may intensify, potentially leading to a pullback before further gains occur.
Ethereum flashes bearish signs
One of the most important Ethereum on-chain metrics indicating this decline is the price-to-daily active addresses (DAA) divergence. Simply put, the DAA price differential indicates whether the value of a cryptocurrency increases as user engagement increases.
When the indicator reading is positive, it means Increased user engagement, Therefore, this provides an opportunity for prices to move higher. On the other hand, when DAA price is negative, it means there is less activity on the network, so the rise may stall.
According to data from Santiment, Ethereum’s price DAA divergence has dropped to -64.17%. This sharp decline Indicating a decrease in the number of addresses interacting with the cryptocurrency. Given the above conditions, the price of ETH may be reduced therefore.
Furthermore, BeInCrypto’s analysis of token holding times also aligns with this bias. Token holding time measures how long a cryptocurrency has been held without being sold or traded.
When it increases, it means that the majority of holders decided not to sell. But the decline, on the other hand, suggests otherwise.
According to IntoTheBlock, Ethereum’s token holding times have decreased since December 6, indicating that the cryptocurrency is facing selling pressure. If this trend The price of ETH may fall below the $3,900 mark in the coming days.
ETH Price Prediction: Back Under $3,800?
On the 4-hour chart, Ethereum price faces resistance to $4,073, leading to a pullback to $3,985. Additionally, cumulative volume delta (CVD) has fallen into negative territory.
CVD is a technical analysis tool that provides a detailed view of buying and selling pressure in the market. Through this indicator, traders can discern the net difference between Buy and sales volume during a specific time period.
When CVD is positive, it means buying pressure is dominant. On the other hand, a negative CVD indicates rising selling pressure, which is the case with ETH.
If it remains unchanged, the price of Ethereum could drop to $3,788. In a highly bearish scenario, the price could drop to $3,572. However, if Trend changesthis may not happen. Conversely, the cryptocurrency may rise towards $4,500.
Disclaimer
conform to trust project Guide, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to providing accurate and unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult a professional before making any financial decisions. Please note that our terms and Conditions, privacy policyand Disclaimer Updated.
