Blockchain analysis firm Santiment has issued some warnings about the leading altcoin Ethereum (ETH). The platform argues that the rate of MVRV in ETH has risen and therefore ETH has entered a dangerous zone. He also states that the bulls need to increase their selling to avoid the risk of selling. It is thought that returning below $ 2,000 will not be very pleasant. As Kriptokoin.com, we are relaying the metrics that the platform draws attention to…
Warning for the leading altcoin from Santiment
Offering on-chain data, Santiment states to investors that Ethereum is at risk of further declines. Santiment states that ETH is in a danger zone, based on the MVRV metric, which measures the ratio between Ethereum’s market cap and realized value, which takes a seven-day period. Santiment uses the following expressions in a recent tweet:
7-day MVRV measuring short-term profit/loss of ETH holders, that we have entered the danger zone where historically well-profited short-term holders are about to take profits, and It shows that we have reached the peak in the last three months.
What does MVRV show?
MVRV is a ratio that is the market value of an asset divided by its actual value. A high MVRV indicates a fairly high percentage of unrealized profit, and thus investors tend to sell their investments to make a profit. A low MVRV may indicate that the asset is suffering from low demand. Emphasizing that the drop in ETH price and MVRV could be healthy for ETH, Santiment says:
A drop in price and MVRV in the coming days will help create a good reset and opportunity.
Santiment warns investors that Ethereum’s price action is giving bearish signals and argues that the number of bulls, i.e. bullish ETH, must increase to avoid a potential sell-off. Following January 2022 lows, ETH dropped higher in February, according to Santiment. It is stated that it makes sense for the bulls to hope for a higher top to continue the resistance in the $3,100 and $3,200 range. It is also argued that the re-examination of $ 2,000 levels may not be pleasant for the asset.
48205
