Ethereum’s [ETH] market strength is rebounding after a month-long decline of 16.81%. Within the last 24 hours, the digital asset has experienced a positive gain of 2.87%, reaching $2,718.88 at the current time.
Analysis of on-chain metrics indicates notable buying activity, particularly from U.S. retail investors, which, when combined with historical trends, suggests a developing bullish trend.
Emerging Historical Trends
A cryptocurrency analyst has noted a pattern in Ethereum’s Market Value to Realized Value (MVRV-z) score on Glassnode that mirrors past movements preceding significant price surges.
The MVRV-z score serves as a tool to identify potential points of overvaluation or undervaluation based on the asset’s chart position.
As per the analyst:
“Ethereum has not yet entered a bull market in this cycle.”
This assessment is drawn from historical upswings that followed Ethereum entering the green zone on the chart.
The current positioning of ETH in this zone, along with its upward trajectory, suggests a potential extended bullish phase.
Declining Supply Amid Retail Investors’ Purchases
CryptoQuant data displays a decrease in ETH exchange reserves. From February 2nd to now, there has been a reduction of approximately 714,129 ETH available on exchanges.
This substantial drop hints at increasing demand among investors acquiring large volumes of ETH and transferring it to private wallets.
Exchange reserves represent the quantity of an asset available on various cryptocurrency exchanges.
Recent buying interest has been attributed to U.S. retail investors, identified using the Coinbase Premium Index. This metric compares trading activity on Coinbase to that on Binance.
A positive index reading signifies heightened accumulation by U.S. investors, with the current index value residing at 0.0255 in the positive territory.
If U.S. investors persist in accumulating alongside other market participants, ETH’s price trajectory is likely to continue upward.
Surge in Buying Volume
The Taker Buy Sell Ratio has surged from 0.967 to a peak of 1.084 in a day – a level not observed since January 3rd.
A ratio above 1 indicates more buying activity in the derivatives market than selling, strengthening bullish sentiment.
With U.S. investors actively engaging in spot market purchases and optimism growing in the derivatives landscape, ETH’s rally seems to be gaining traction.