Ethereum is Getting Close to an “Opportunity Zone”, According to Santiment
According to Santiment, a crypto analytics firm, Ethereum (ETH), may be entering a promising phase. They have identified a metric known as the 30-day market value to realized value (MVRV), which traders utilize to identify overbought or oversold conditions.
Currently, the MVRV for ETH has moved out of the “danger zone” and is trending towards an area historically associated with price bottoms, referred to as the “opportunity zone.”
MVRV is calculated by dividing an asset’s current market capitalization by its realized capitalization, which represents the value of all ETH measured at the time of purchase.
The MVRV 30-Day metric analyzes this ratio for tokens transacted at least once within the past 30 days.
In addition, Santiment highlights a significant event where the Ethereum Foundation transferred 14,999 ETH to the crypto exchange Kraken.
📊 With the $ETH foundation moving 14,999 coins to @krakenfx, an argument can be made that this move perfectly coincided with #Ethereum's local price top. Our insight covers the massive surge in active deposits & potential dip buy opportunities coming up. https://t.co/F1XBFzulaR pic.twitter.com/Nypl5thKps
— Santiment (@santimentfeed) May 9, 2023
This occurrence coincided with the recent local price peak of ETH. Santiment suggests that this move by the foundation may have influenced the price action and indicates potential opportunities for buying during a possible dip.
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Santiment further points out that in previous instances where a substantial amount of ETH was withdrawn from the Ethereum Foundation wallet, it coincided with local price peaks. However, the analytics firm clarifies that transactions by the Ethereum Foundation prior to those instances did not signal price tops.
At the time of writing, Ethereum is trading at $1,831, reflecting a 1.86% increase in the past 24 hours. It remains the second-ranked cryptocurrency based on market capitalization.