KEY POINTS
- The number of transactions grew alongside the price of Ethereum
- Volume in spot cryptocurrency exchanges is recovering
- Open interest for Ethereum options appears bullish
While all eyes are on Bitcoin, the second-largest cryptocurrency has been making some effort to reclaim the $600 range, which might catapult Ethereum to a new all-time high, according to analysts.
Ethereum closed Sunday at $590, its highest in the last five days. Analysts predicted a new consolidation phase that will only be broken once $600 is breached.
A number of on-chain factors appear to favor an upsurge in Ethereum’s price. First, there has been a significant increase in the growth of transactions and transfers in the Ethereum blockchain, Cointelegraph reported. The chart showed that transaction growth (and slump) correlates with the price.
Cointelegraph also noted the increase in the number of people withdrawing their ETH from cryptocurrency exchanges. This can be attributed not just to people transferring to cold storage but also to those who transfer to put ETH on staking and yield farming platforms. Remember that Ethereum is also transitioning to 2.0, and to kickstart this, a number of people and entities have staked a total of 1.4 million ETH into it to secure the network.
Ethereum achieved a new 2020 high on Nov. 30 at $616. It did reach a higher price the next day at $620, but it closed at $584. Since then, there has been a decline in the price, but technical indicators appeared to normalize. The Relative Strength Indicator (RSI) is currently below 60, while the MACD is appearing to cross bullish territory again.
If this is new firepower to kickstart a new upside run, Cointelegraph pointed to the current ETH volumes on spot exchanges, where a chart suggests recovering volumes.
The options put/call ratio in the ETH options market allows for another gauge of market sentiment. At the moment, there is a 0.70 put-to-call ratio. This indicates that open interest in put options are weaker by 30% versus bullish calls.
This all points back to $600 as the most important hurdle to be overcome by the price. There is strong support in the $578 and $580 levels, according to NewsBTC.com. For a return to $600, the minor resistance at $592 must be breached first.