As the bear market continues, Ethereum – the second-biggest cryptocurrency – continues to struggle. If you look at the data from CoinGecko, the most notable positive change is 4.1% on the bi-weekly timescale.
The red flashing of the longer time scales, however, indicates that ETH has been declining in value since the FTX collapse, and this fact overshadows the shorter time scales.
- The upswing was triggered by a sudden increase in demand for prime real estate
- The descending triangle, a confirmation of a rally, is formed in part by accumulation blocks
- To push prices higher, ETH buyers need to break over the $1,306.66 barrier
However, a number of indicators are suddenly showing optimistic signs. With the price of ether at $1,283 right now, recent headlines have reported a sharp increase in the number of holders with certain units of ether.
Glassnode discovered a surge in the number of addresses holding 32 ETH or more, or nearly $42,000, despite the fact that the price of Ethereum (ETH) has been dropping and has been volatile.
The chart indicating the number of active addresses that had been tallied showed that there were more than 127,000 of them. In addition, it was quite evident that the number of addresses at this time had not only been up but had reached an all-time peak in the previous few years.
Possibly Creating A Rally?
Contrary to the rise, CryptoQuant reports that the number of active addresses fell on December 7th. Another bullish indicator is the sharp drop in foreign exchange reserves that has coincided with the rise in the number of high-value addresses.
ETH created two bullish order blocks before the increase in high-value addresses. The price of ETH increased by 14.33% and 12.94% during the first and second bullish blocks, respectively.
Chart: CryptoQuant
The increase of high-value addresses has not yet been reflected in the price, as the price has decreased throughout this time period. Recent market moves have also contributed to the creation of a bullish descending triangle.
The regression channel, which has a Pearson’s R value of 0.6824, bolsters this bullish finding. This indicates that the upward breaks of the upper half of the regression channel correspond to a significant upward trend.
Chart: TradingView
Quite Surprisingly Bullish
The moving average of the Bollinger band acts as resistance at $1,252.15, thereby prolonging this surge. With the RSI rising and the MFI turning bullish, though, the ETH price should explode.
Consequently, ETH bulls should initially aim for $1,306. If momentum permits, a further target of $1,348 would indicate that this is the relief rally that ETH holders have been anticipating.
The construction of bullish order blocks, the decline in exchange reserves, and the increase of high-value addresses led to the current state of affairs. With Bitcoin’s bullish trend, the future of Ethereum appears to be very bright.
ETH total market cap at $156.7 billion on the daily chart | Featured image - The Block, Chart: TradingView.com