Data indicates a potential rise in the price of Ethereum despite a 15% price drop.
The leading altcoin, Ethereum (ETH), has seen a 15% decline in the past seven days. However, on-chain data revealed that this price decline only reflects the broader sell-off in the cryptocurrency market as the bullish bias towards altcoins remains significant.
This analysis highlights two key on-chain metrics that point to a potential rally towards the $4,000 price area in the near term.
Ethereum is seeing bullish momentum despite falling prices
Firstly, High estimated leverage ratio for Ethereum ELR indicates a sustained appetite for risk, reflecting the potential for price recovery. According to CryptoQuant, its price is 0.53 at the time of publication.
The ELR of an asset measures the average amount of leverage used by traders to execute trades on a cryptocurrency exchange. It is calculated by dividing an asset’s open interest by the exchange’s reserve for that currency.
A higher ELR for ETH indicates increased risk appetite among traders. It indicates that many investors remain optimistic about future currency price growth and are willing to leverage their positions to amplify potential gains.
additional, Positive funding rate for ETH It is another sign that its price may see a recovery soon. According to CryptoQuant, this currently stands at 0.016. Despite the recent price decline, the funding rate across cryptocurrency exchanges has remained positive, reflecting the bullish trend towards ETH.
The asset financing rate is a periodic fee that is exchanged between long and short traders in the asset Futures contracts market. It ensures that the price of perpetual futures matches the spot price. When it is positive, long term traders pay pantiesWhich indicates bullish sentiment and expectations of rising prices.
ETH Price Forecast: Will $4,000 Be the Next Stop??
ETH is currently trading at $3,344. If the bullish bias persists and buying activity picks up, ETH price could rise above the $3,439 resistance level. A breakout at this level could push the coin towards $3,733, paving the way for it to cross the psychological barrier of $4,000.
However, if the downward trend continues, ETH value may drop to $3,232Which invalidates this bullish outlook.
Disclaimer
In line with Trust Project Guidelines This price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to providing accurate and unbiased reporting, but market conditions are subject to change without notice. Always do your own research and consult a professional before making any financial decisions. Please note that we have Terms and Conditions, privacy policyand Disclaimer Updated.
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