- Stablecoin volume on Ethereum fell to $40 billion, indicating the potential of leading the cryptocurrency to a bear phase.
The MVRV Long/Short Difference, alongside holders’ sentiment showed that ETH’s price might increase.
As a seasoned crypto investor with a few years of experience under my belt, I’ve learned to pay close attention to metrics and trends when it comes to making informed decisions about my investments. The recent drop in stablecoin volume on Ethereum from $84 billion to $40 billion has raised some red flags for me. Historically, this trend has indicated a potential shift into a bear phase for ETH. However, I’m not entirely convinced that this will be the case based on other metrics andholder sentiment.
As a crypto investor keeping a close eye on Ethereum [ETH], I’ve noticed a significant decrease in stablecoin volume from $84 billion to $40 billion as per the latest data from CryptoQuant. Normally, an uptick in stablecoin volume indicates growing demand for tokens on the blockchain. However, this recent drop could potentially signal reduced interest or even selling pressure within the stablecoin market. It’s crucial to stay informed and monitor the situation closely.
When this occurs, it enhances the inherent cryptocurrency within its ecosystem. For instance, a decrease in trading volume for Ethereum signifies that most ERC-20 tokens associated with it have not performed well.
ETH holders don’t believe in bears
Tokens based on the ERC-20 standard are the fungible digital assets generated through Ethereum’s blockchain. Previously, a significant decrease in stablecoin trading volume down to $30 billion could signal a bearish trend for Ethereum, implying potential risk.
Currently, Ethereum’s value was priced at $3,517 during our latest check-in, marking a 4.18% drop over the past week. Despite forecasts suggesting a return to $4,000, this level has eluded us for several weeks now.
In addition to this, AMBCrypto examined the Long-Term Holder Net Profit/Loss Ratio (LTH-NUPL). LTH-NUPL is a metric used to analyze the actions of long-term investors.
Generally speaking, the metric takes into account Ethereum addresses holding unspent output coins, or UTXOs, for a minimum duration of 155 days. As reported by Glassnode, Ethereum’s Long-Term Holder Net Unrealized Profit and Loss (LTH-NUPL) indicator fell within the “belief” or positive zone.
This indicates that holders of the token are convinced that the price might increase.
If the current conviction about ETH‘s price stability holds true over the next few weeks, it’s possible that the token may avoid a price downturn. Instead, its value might be primed to reach a new record high due to strong market demand.
Will rising volatility lead the price higher?
The difference between the Market Value to Realized Value (MVRV) of Ethereum in long and short positions serves as an indicator to determine whether Ethereum is currently experiencing a bear market.
If the metric for a cryptocurrency reads below zero, it could indicate that the asset has entered a bear market.
As the metric stays favorable, the cryptocurrency is experiencing a bull market. According to AMBCrypto’s latest report, the MVRV Long/Short Difference amounts to 35.50%.
Although ETH‘s reading this month showed a drop compared to last month, this decline doesn’t necessarily mean ETH has given in to the bear market. Yet, it’s important to acknowledge that the downward trend could potentially signal further price decreases.
As an analyst, I would interpret this as follows: Should the value of the cryptocurrency hold above $3,000, it is unlikely to dip below that point. If this trend persists, Ethereum could potentially regain ground and challenge the $4,000 mark and even surpass it.
As an analyst, I’ve noticed that the daily price fluctuations have become more pronounced lately. Volatility refers to the speed at which prices change in various directions. With heightened buying pressure, prices can experience significant upward swings.
Read Ethereum’s [ETH] Price Prediction 2024-2025
From my perspective as an Ethereum investor, the unpredictable nature of its price swings can lead to significant selling pressure, which in turn may trigger a correction. The future direction for Ethereum’s price is currently up in the air.
As a crypto investor, I couldn’t help but feel a sense of resolve among the community. It was clear that many were unwilling to yield to the downward pressure from bears, despite their best efforts to push prices lower than anticipated.
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2024-06-18 04:07