Ethereum has been on a remarkable rally over the past few weeks. Since the start of July, when the asset was trading closer to ~$220, ETH has literally doubled. It trades just shy of $440 as of this article’s writing, flat in the past 24 hours.
Although some see this move as an impulsive surge that isn’t sustainable, on-chain metrics show that Ethereum is in a good spot. They add to the positive technical signals ETH has formed over recent months.
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Ethereum’s On-Chain Fundamentals Are Bullish
According to Santiment, a blockchain analytics firm, Ethereum is a good place in terms of its fundamentals. The company noted in an August 16th analysis that two pivotal on-chain metrics are nearing or are at all-time highs:
“The $ETH daily transaction count neared an all-time high this week. Its ATH of 1.34M was set back on Jan 4, 2018 when #Ethereum had an average market price of $1,042. Earlier this week its transaction count was within shouting distance at 1.27M. $ETH transaction fees also broke all-time highs two days in a row, with fees of 17.8k $ETH (8/12) and 20.3k $ETH (8/13).”
Chart of ETH's price action with the number of daily transactions from Santiment, a blockchain analytics firm.
Santiment claims that these two metrics reaching these levels “is a good long-term sign of things to come for #Ethereum holders.”
Tangentially related to this, analysts have found that there is somewhat of a correlation between Ethereum network activity and the value of ETH. This is likely due to the fact that to send transactions interacting with Ethereum, ETH must be spent.
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Technicals Corroborate Expectations of Upside
Technical analysts also think Ethereum is in a good spot from a short-term and longer-term perspective.
As reported by NewsBTC, the head of technical analyst at Blockfyre, a cryptocurrency research firm, said:
“$ETH looking ready for another leg up imo. $450 weekly resistance up next on the plate. Wouldn’t be surprised to see a lot of this alt money flow into Eth and see some healthy corrections across the board short term. Reducing some exposure to move to Eth.”
On Ethereum’s long-term outlook, the same trader who predicted the point at which BTC would bottom in 2019, noted recently that ETH has upside because its one-month MACD has crossed into the green.
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Photo by Etienne Girardet on Unsplash Price tags: ethusd, ethbtc Charts from TradingView.com These 2 On-Chain Signs Suggest Ethereum's Long-Term Trend Is Positive