These Bullish and Bearish Signals for Ethereum (ETH) Can Determine the Price Action

By Bhushan Akolkar
Published November 12, 2021 Updated November 12, 2021
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These Bullish and Bearish Signals for Ethereum (ETH) Can Determine the Price Action

By Bhushan Akolkar
Published November 12, 2021 Updated November 12, 2021

The world’s second-largest cryptocurrency Ethereum (ETH) recently touched a new all-time high above $4800 and is currently flirting close to those levels. While there have been expectations of ETH reaching $5000 levels very soon, the network congestion and high gas fee prove to be a kind of barrier.

It’s difficult at this point to say in which direction Ethereum (ETH) will move. On-chain data provider Santiment reports that the Ethereum address activity is up by 48% after the number of unique ETH addresses bottoming out in late September.

Courtesy: Santiment

Furthermore, Crypto Quant CEO Ki-Young points out that the ETH supply in the market isn’t increasing anymore. Post the London hardfork, the rate of ETH supply has become almost zero. thus, Ethereum is turning out to be a scarce asset that can be a bullish signal for the world’s second-largest crypto.

However, the ETH price action and its trading volumes have been forming a bearish divergence recently.

On-Chain Bearish Indicators for Ethereum

On-chain data provider Santiment reports that there’s a strong bearish divergence between the ETH price and its trading volume. Although the Ethereum trading volume has been trying to pick up with the price, it hasn’t succeeded well and instead moved down. This is particular true since the end of October.

Courtesy: Santiment

A similar scenario appears for Ethereum (ETH) social volume and the ETH network profit and loss. The on-chain data provider Santiment notes:

A bunch of long lasting divergencies is pointing us to idea that we need to go down. These are really worrying. We see network activity going down even though the price is pushing up.

People too relaxed to take profits even though ETH is going up (visible in NPL). There is a good chance they will be punished.

There is 50/50 chance market quite often moves up one more time after divergence. Just to confuse traders.

It will be interesting to see as to what price action does Ethereum follows from here onwards.

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Disclaimer
The presented content may include the personal opinion of the author and is subject to market condition. Do your market research before investing in cryptocurrencies. The author or the publication does not hold any responsibility for your personal financial loss.
About Author
Bhushan Akolkar
900 Articles
Bhushan is a FinTech enthusiast and holds a good flair in understanding financial markets. His interest in economics and finance draw his attention towards the new emerging Blockchain Technology and Cryptocurrency markets. He is continuously in a learning process and keeps himself motivated by sharing his acquired knowledge. In free time he reads thriller fictions novels and sometimes explore his culinary skills.

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