Ethereum (ETH) has started a new wave of rise in the altcoin market by reaching $ 3600. Ethereum, which has been performing weaker than Bitcoin for a while, finally managed to surpass $ 3500 and then rose rapidly towards $ 3600. This increase also provided significant value gains in other cryptocurrencies in the Ethereum ecosystem. This development, which pleased altcoin investors, led to speculation that the price of Ethereum could rise even more.
Analysts assessing Ethereum’s market performance often refer to the Market Cap to Realized Value (MVRV) ratio. This metric compares the market cap of an asset to its realized value, indicating whether it is overvalued or undervalued.
MVRV Ratio Increase: A rising ratio indicates that most investors are in the money. However, if the ratio reaches extreme levels, it may indicate that the asset is overvalued and the risk of a price correction is increasing.
MVRV Ratio Decline: A decrease in the ratio indicates that investor profitability is decreasing, which can present attractive opportunities for those looking to buy at lower prices.
Ethereum’s 30-day MVRV ratio currently stands at 11.89%, which is far from the 18-22% range that is generally considered local highs, suggesting that Ethereum’s price is not yet overvalued and therefore has upside potential.
Another notable metric for Ethereum is the Median Investment Age (MDIA). This metric measures the average age of all Ethereum coins and is weighted according to the price at which the coins were purchased.
MDIA Rise: Indicates that coins have been dormant for a longer period of time and the probability of sudden price increases is decreasing.
MDIA Decline: Indicates that previously dormant coins are starting to be traded and trading activity is increasing.
The MDIA on Ethereum is showing a bearish trend, indicating that market volatility is increasing and Ethereum’s price rally may continue.
Could Ethereum Hit $4,000?
On the daily chart, Ethereum has formed an inverse head-and-shoulders pattern following a downtrend. This pattern signals that sellers are about to run out and an uptrend may begin.
Elements of the formation:
Left shoulder (first uptrend)
Head (end of downtrend)
Right shoulder (indicates the recovery process)
Ethereum is currently following this uptrend and there could be a move towards $4000 in the short term. However, if the selling pressure increases, this scenario could change and the Ethereum price could drop to $3,206.
The future price movements of Ethereum will depend on market conditions and investors' buying and selling decisions.