After reaching a recent peak of $4,109, Ethereum (ETH) witnessed a significant market correction that led to a drop to as low as $3,095 before experiencing a rebound of over 7% within 24 hours. Analyst Mac D from CryptoQuant suggests that macroeconomic factors could have been behind this correction.
Nevertheless, there are signs of recovery, with investors continuing to accumulate ETH at the current price levels.
Surge in ETH Accumulation Addresses
Recent data from CryptoQuant shows a substantial surge in Ethereum accumulation addresses, surpassing levels seen in previous cycles.
Address holdings increased by 16% in August, which translates to 19.4 million ETH out of the total supply of 120 million ETH. This represents a growth rate surge from 10% in August to 16% by December 2024, a significant increase not observed in past ETH cycles.
The rise in addresses accumulating ETH reflects strong market optimism towards favorable crypto policies and indicates continued accumulation of ETH by smart investors despite price volatility.
Although short-term market corrections are possible due to macroeconomic influences, the long-term outlook remains positive. The ongoing accumulation and rise in addresses holding ETH suggest a promising growth trajectory for Ethereum.
Impact on ETH Price
The increase in accumulation has notably influenced the price of ETH, with the altcoin’s value rising from $2,116 to $4,109 during this accumulation phase.
Currently, Ethereum is trading at $3,504, marking a 5% surge in the last 24 hours.
The upward momentum in price is driven by heightened buying pressure, as evidenced by the Taker Buy sell ratio which surged to 1.08, indicating aggressive buying behavior and potential supply-demand imbalances.
The prevalent bullish sentiment is reflected in investors’ long positions dominating the market at 51%, indicating a positive outlook for further gains.
In summary, the increasing accumulation of Ethereum suggests potential growth ahead. As more investors accumulate and increase their holdings, buying pressure intensifies, potentially leading to a supply shortage and pushing the altcoin’s price higher.
If the trend of rising accumulation addresses continues, ETH could target $3,713, while a decline similar to recent corrections might see Ethereum retracing to $3,300.