The Ethereum price appeared to be finally gearing for a strong bullish breakout after multiple weeks of disappointing and sluggish action. However, this bullish dream ended almost immediately after it started as nearly $1.5 billion worth of ETH tokens were drained from the ByBit exchange.
Ethereum, which traded as high as $2,840 earlier on Friday, February 21, dropped towards $2,600 on the back of news of the ByBit hack. Interestingly, recent on-chain data suggests that the altcoin’s price could still make its way to $4,000 before the end of this cycle.
Could ETH Price Still Record A 60% Rally This Cycle?
In a Quicktake post on the CryptoQuant platform, an analyst with the pseudonym Crypto Sunmoon identified a particular bullish divergence that offers insight into the Ethereum price performance in the near future. This bullish observation is based on recent movements of ETH’s “taker buy/sell ratio” across all exchanges.
This metric measures the taker buy and taker sell volumes for a specific cryptocurrency (Ethereum, in this case). When the taker buy/sell ratio is greater than one, it implies that the taker buy volume is higher than the taker sell volume. This is typically considered a bullish signal, indicating the willingness of investors to pay a higher price for an asset.
On the contrary, a less-than-one taker buy/sell ratio indicates that sellers are overwhelming the buyers in the market. This scenario suggests that more sellers are willing to offload their assets at a lower price, signaling a bearish shift in investor sentiment.
Crypto Sunmoon noted that the 100-day exponential moving average (EMA) of the Ethereum taker buy/sell ratio on all exchanges has been rising in recent weeks. The Ethereum price, on the other hand, has been declining since mid-December.
According to the analyst, this divergence is positive, as it indicates that a bearish trend has ended and an upward trend could be starting. The last time this bullish divergence occurred, the Ethereum price traveled from beneath $2,500 to above $4,000 (over 60% rally).
While investors would view a reclaim of $3,000 as a victory for Ethereum, history and this bullish divergence suggest that the altcoin’s price could still climb toward the $4,000 mark before the end of the current cycle.
Ethereum Price At A Glance
As of this writing, the price of Ethereum stands around $2,650, reflecting a nearly 4% decline in the past 24 hours.
Featured image from iStock, chart from TradingView
Opeyemi Sule
Opeyemi is a proficient writer and enthusiast in the exciting and unique cryptocurrency realm. While the digital asset industry was not his first choice, he has remained absolutely drawn since making a foray into the space over two years. Now, Opeyemi takes pride in creating unique pieces unraveling the complexities of blockchain technology and sharing insights on the latest trends in the world of cryptocurrencies.
Opeyemi savors his attraction to the crypto market, which explains why he spends the better parts of his day looking through different price charts. “Looking” is a rather simple way to describe analyzing and interpreting various price patterns and chart formations. However, it appears that is not Opeyemi’s favorite part – in fact, far from it.
Being able to connect what happens on a price chart to on-chain movements and blockchain activities is what keeps Opeyemi ticking. “This emphasizes the intricacies of blockchain technology and the cryptocurrency market,” he would say. Most importantly, Opeyemi thinks of any market insights as the gospel, while recognizing that he is only a messenger.
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Ultimately, Opeyemi is a good writer and an even better person who is trying to shed light on an exciting world phenomenon – cryptocurrency. He goes to bed every day with a smile of satisfaction on his face, knowing that he has done his bit of the holy assignment – spreading the crypto gospel to the rest of the world.
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