Upper Altcoin, Ethereum was trading at $ 3,800 after an exponential rally in the middle of which it tested the psychological level of $ 4,000 on September 3. It has managed to stay strong, staying well above $ 3,750. If it manages to rally above $ 3,860, a retest of the all-time high would be next on ETH cards.
So how far can the Ethereum rally go? The answer to that can be found in the following metrics.
Highest network rating in more than a year
Ethereum’s NVT signal (14-day MA) recently hit a 17-month high, last seen in August 2020. A high value of NVT suggests that the network’s valuation is outpacing its transaction volume. When NVT is high, the value of the network is well above the value that is transferred to the network, although it can represent a potential bubble, in the case of Ethereum it represented legitimate growth stages, along with strong price action.
In particular, for the past two years, whenever the NVTS experienced parabolic growth, Ethereum showed a sustained rally with massive price gains. A similar trend was observed towards the beginning of January 2020, when Ethereum surged almost 140% in just one month.
Interestingly, this time too, a 140% rise from a July 20 low will take the alt close to $ 4300, which is around an ATH of $ 4,337.10. So a strong NVTS track record of around 140% in profit could push ETH to its ATH and perhaps above it, if the rise in NVTS continues.
However, a drop in Ethereum’s active directions that takes it to an all-time low of eight months is a worrying trend, but a push in active directions may further fuel the rally. An increase in active addresses, before ETH sees its ATH, would be crucial.
The future of ETH futures looks good
In addition to the high value of the network, other factors that influence the price of ETH are the open interest and the daily volume of ETH futures. Based on Skew data, ETH options volume increased over the last week. In fact, on September 1, Ethereum saw the highest spike in option volumes followed by another small spike two days later.
Additionally, Ethereum’s open interest in perpetual futures contracts hit a 13-month high of $ 589,275,968.65 on Okex. On other exchanges as well, the aggregate open interest of ETH futures was high, totaling close to its May ATH of 10.9 billion. At press time, total aggregate futures open interest stood at $ 10.6 billion. Those looking for profit on Ethereum you might find the derivatives market an attractive opportunity.
The path from ETH to ATH
The main altcoin reaching its ATH will be critical to the rise of Defi, NFT market tokens, and other altcoins. Additionally, ETH could increase Defi’s overall market capitalization with various projects closely following ETH in terms of price action and correlation. By now, ETH was around 30% of its ATH. However, a boost from spot traders and a surge in active addresses could secure its ride up.
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