In a recent analysis, comments from crypto analytics platform Santiment drew attention. He spoke for Ethereum (ETH), the second largest cryptocurrency and largest altcoin by market cap. It has uncovered some metrics that have remained overlooked, pointing to a potential bullish breakout in ETH. The comments of Brian Quinlivan, Santiment’s marketing director, gave hope for the coin. He highlighted key indicators showing that ETH could rise above and beyond an important psychological level. Here are the details…
Santiment analyst speaks for leading altcoin
One of the main metrics Santiment observed was Ethereum’s profit-loss ratio in on-chain transactions. This ratio, which is currently in positive territory, shows that investors are trading with profit. However, Quinlivan noted that if the metric falls marginally, it could trigger an increase in demand. He also stated that this could potentially lead to an upward price move. Quinlivan continued:
One of the most important signs of a potential bottom price approaching will be when traders start trading at a higher level when they are at a loss than when they are in profit. At the moment, we can see that the on-chain trading volume to profit-to-loss ratio is still in favor of making profits. But by no means by a large margin… and if ETH drops further from here and threatens the $1,700-1,800 level again, panic selling will ensue to justify the buys.
Ethereum supply on exchanges remained low
In addition, Santiment showed that the supply of Ethereum on exchanges is currently below 10 percent. He found that this is considered a bullish signal. Quinlivan drew attention to this issue and said:
We can also continue to be content with the fact that Ethereum coins are largely stored in private wallets. The total of coins on exchanges represents less than 7 percent of coins in circulation. Therefore, the probability of large sales to occur remains lower than usual. This should be seen as one of the best long-term confidence signs for the asset, which experienced a somewhat disappointing (price-wise) update in September 2022.
What happened on the Ethereum network?
As Cryptokoin.com also reported, the September 2022 Ethereum Merge, which witnessed the transition of crypto from PoW to PoS, also plays a role in shaping the market sentiment. This move, aimed at addressing scalability and environmental concerns, was critical. It has been an important milestone for the future growth and adoption of Ethereum. Considering these bullish metrics, Quinlivan expressed that he is optimistic about Ethereum’s price target. He stated that patience can be rewarded.
“We see no reason why ETH should not rise above $2,000 in August or before the new moon arrives,” Quinlivan said. All in all, Santiment’s analysis points to several indicators pointing to a potential bullish breakout for Ethereum. As the market continues to evolve, all eyes will be on ETH to see if it can reclaim its $2,000 and above position in the coming weeks.
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