Ethereum Prepares for Growth: Three Indicators Signal Potential Double-Digit Surge
Ethereum’s active addresses are witnessing an increase, coinciding with a notable capitulation in Ether. Jump Crypto has been observed liquidating over $277 million in Ether over the past ten days, contributing to the altcoin’s capitulation. Monday saw over $909 million in realized losses, marking the most substantial single-day capitulation event in Ether since September 2023. Despite this, Ether could potentially surge by nearly 20%, aiming to reach the psychologically significant $3,000 level.
Recent Ethereum (ETH) on-chain metrics are displaying promising signs for the second-largest cryptocurrency by market capitalization. Ether has experienced a surge in active addresses, a significant capitulation event, and a negative Market Value to Realized Value (MVRV) ratio, all suggesting a potential price recovery in the near future. As of the time of writing on Wednesday, Ether is trading at $2,526, reflecting a 2.5% increase.
Three key indicators support a bullish outlook for Ethereum. The Active Addresses metric, which showcases the asset’s relevance and demand, has seen a 15% rise from 410,560 on Monday to 472,640 presently. This uptick in active addresses indicates growing interest in Ether following the recent crypto market downturn. Additionally, the Network Realized Profit/Loss metric reveals that significant losses have been realized, with Jump Crypto notably liquidating its Ether holdings, contributing to the substantial negative spike on Monday.
The Market Value to Realized Value (MVRV) in the 30-day timeframe currently stands at a negative 15.54%, indicating that the altcoin is undervalued on average. This presents a buying opportunity for sidelined traders anticipating a potential recovery in Ether’s price.
Looking ahead, Ether is eyeing the $3,000 level, representing a potential 20% increase. However, on its upward trajectory, Ether may encounter resistance at two Fair Value Gaps (FVGs) between $2,556 and $2,630, as well as between $2,697 and $2,859. The Relative Strength Index (RSI) momentum indicator suggests that Ether is currently oversold in the daily chart, potentially signaling a buying opportunity for the altcoin.
In the event of continued bearish momentum, Ether could find support at the $2,414 level and the August 5 low of $2,111, as depicted in the ETH/USDT daily chart. These levels may serve as crucial support zones in case of further downside pressure.
