The crypto market has been plagued by increased volatility lately, with the second largest crypto token by market cap, Ethereum (ETH), not exempt. This has made it more difficult to determine Ethereum’s future trajectory. However, certain metrics indicate which direction ETH’s price could go if this volatility subsides.
Ethereum investors are bullish
Facts from Coinglass shows this the most Ethereum investors and traders are still bullish on the crypto token despite recent fluctuating prices. Specifically, most of these traders have continued to open long positions on Ethereum, meaning they are betting that significant upside will emerge in the long term.
The bullish sentiment towards Ethereum is highlighted by a trader who, after losing $4.5 million while craving ETH, is still opened another long position on the second largest crypto token. This crypto whale even went as far as to borrow 17.3 million USDT from Compound just to increase their position on Ethereum.
These investors’ bullish stance on Ethereum is even more commendable as the bulls have suffered the most from ETH’s high volatility. Facts from Coinglass shows that over $16 million in long positions were liquidated in the last 24 hours, compared to the $10 million short positions liquidated during this period.
In the meantime, facts of the market information platform InHetBlok shows that Ethereum Market value to realized value (MVRV) The ratio has fallen, indicating that many Ethereum holders are not yet making a profit. This could be bullish for ETH’s price as these holders are likely to hold in anticipation of further upward price action, providing support against any price declines.
Making a case for the bears
While derivatives market activity and Ethereum’s MVRV ratio paint a bullish outlook for the crypto token, Ethereum’s price network growth suggests that ETH could still experience further price declines. Facts van Santiment shows that the rate at which new users enter the Ethereum ecosystem has slowed recently.
This is decreasing network growth is also evident from a recent Bitcoinist report, that noted that Ethereum fees have fallen to their lowest level since January. Ethereum fees They are known to skyrocket when there is more activity on the network. Therefore, low costs ensure that there are fewer new users currently engaged in transactions on the network or even not holding an ETH token at all.
The silver lining, however, is that facts van Santiment also shows a speed increase, indicating that existing users on the network are actively trading and injecting more liquidity into the Ethereum ecosystem. This factor could also contribute to potential price increases for the ETH token.
At the time of writing, Ethereum is trading around $3,200, which is believed to be on the rise over the last 24 hours. facts from CoinMarketCap.
ETH bears pull price below $3,200 | Source: ETHUSD on Tradingview.com
Featured image of Token Information, chart from Tradingview.com
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