Ethereum Trend Spotted by CryptoQuant Analyst Could Spark Next Altcoin Bull Run

An analyst specializing in on-chain data at CryptoQuant has highlighted a significant trend within Ethereum that could potentially spark the next surge in alternative cryptocurrencies. This analyst, known as SunMoon, recently drew attention to the comparison between Ethereum’s price and its Realized Price (RP). The Realized Price represents the average price at which each Ethereum token was last transacted, serving as a key psychological support level in the market.

SunMoon’s analysis revealed that Ethereum’s price was at $2,522 while the Realized Price was approximately $2,210 at the time of assessment. Despite Ethereum experiencing a notable decline over the past five months, it has managed to remain above its Realized Price, which now functions as a crucial support level.

Historically, when Ethereum’s price has stayed above its Realized Price during market downturns, it has often preceded a bullish phase for alternative cryptocurrencies. This trend is heavily influenced by investor sentiment. When Ethereum’s price surpasses the Realized Price, it indicates that a majority of ETH holders are in a profitable position. This reduces the selling pressure and enhances investor confidence in the market.

In a separate analysis by market veteran Michaël van de Poppe, the focus was on the daily ETH/BTC trading pair. This pairing is particularly significant as Ethereum’s strength against Bitcoin is often seen as a precursor to broader strength in alternative cryptocurrencies, making the ETH/BTC chart highly relevant.

Van de Poppe identified a bullish divergence on the ETH/BTC chart. A bullish divergence occurs when the price forms lower lows while the Relative Strength Index (RSI) forms higher lows. Despite ETH declining to 0.0425 BTC, the RSI has displayed signs of upward momentum.

Van de Poppe emphasized the critical support level at 0.042 BTC for Ethereum. Sustaining this level could potentially trigger a rebound, pushing the price towards 0.046 BTC or higher, marking a significant area for a potential trend reversal. Additionally, he noted a slight positive turn in ETF flows, with daily net outflows decreasing to $3.4 million on Aug. 27 and a net inflow of $5.9 million on Aug. 28, marking the first positive flow into ETH ETFs in a ten-day period.

The combination of Ethereum holding above its Realized Price and the bullish divergence on the ETH/BTC pair suggests that the ETH market may be gearing up for a bullish reversal. As of the latest update, Ethereum is trading at $2,478. It is important to note that this content is for informational purposes only and should not be considered financial advice. Readers are advised to conduct thorough research before making any investment decisions.