Ethereum (ETH), the second largest cryptocurrency by market capitalization, continues to trade modestly. below The psychologically important $4,000 price level follows a brutal decline on October 9, when the digital currency tested support around $3,435.
Ethereum remains above realized price – bullish momentum soon?
According to a CryptoQuant Quicktake post by contributor TeddyVision, Ethereum is trading above its realized price of approximately $2,300. The analyst called this price level the “fundamental support zone,” and said a decline below this level has historically signaled capitulation.
For the uninitiated, the realized price represents the average cost basis of all ETH holders and is calculated by dividing the total value of all ETH at the time it was last moved on-chain by the current circulating supply.
Realized price effectively represents the “true” average price paid by investors and serves as a key indicator of whether the market is in profit or loss. As long as ETH trades above its realized price, the market structure is likely to remain bullish.
The analyst also highlighted Ethereum’s market value to realized value (MVRV) ratio. Notably, ETH holders are currently earning an average of 67% on a cost basis. This indicator provides two main hints about the current market.
First, it shows that although the market is profitable, it is still far from the “overheat” level. Second, it shows that market participants are confident in the market’s upward momentum, but are not completely euphoric.
To explain, the MVRV ratio compares an asset’s market value to its realized value. A high MVRV indicates that holders are saddled with larger unrealized gains and often indicates potential overvaluation, whereas a low MVRV suggests undervaluation or market fear.
Additionally, TeddyVision noted Ethereum’s reaction from the upper realized price range, which is currently around $5,300. Analysts said:
Prices fell before reaching the “overheating zone”. This is not an inversion. It is a post-distribution integration stage and a healthy cool-down without structural damage.
Finally, spot inflows of ETH to crypto exchanges have also slowed, suggesting that the digital asset’s next steps are likely to rely on new liquidity rather than leverage. In summary, Ethereum is slowly moving from a decentralized phase to a consolidated phase.
Is it a good time to buy ETH?
Providing reliable future predictions in the cryptocurrency market remains a difficult challenge, but the latest on-chain and exchange data indicates that ETH is regaining bullish momentum. For example, recent Binance funding rates hinted ETH could soar to $6,800.
Similarly, exchanges’ ETH reserves continue to decline rapidly. Earlier this month, ETH supply on exchanges strike This is a multi-year low, raising the possibility of a potential “shortage” that could drive ETH prices up dramatically.
That being said, crypto analyst Nick Patel recently said, warned The ETH price correction may not be completely over yet. At the time of writing, ETH is trading at $3,849, up 0.3% over the past 24 hours.
Featured image from Unsplash, charts from CryptoQuant and TradingView.com
