ETH active addresses drop to 4-month low; is capitulation event in sight

ETH active addresses drop to 4-month low; is capitulation event in sight

ETH active addresses drop to 4-month low; is capitulation event in sight

Since the merger, the number of exchanges on the Ethereum [ETH] network has been hit by a drop, new data from Santiment revealed. According to the blockchain analysis platform, the number of daily active addresses exchanging ETH has steadily declined since the merger, falling to a 4-month low on Oct. 20. This was the result of “weak hands” constantly handing out the leading altcoin. June 26.

Dormancy and other tales 

The market has been characterized by significant investor disinterest in ETH, which has caused the price to stagnate. A look at the median dollar investment age (MDIA) of assets confirmed this. According to Santiment, ETH’s long MDIA tranche showed a rising rate of coins dormant on the network. Over the past six months, the MDIA is up 41%. Such a long stretch in an asset’s MDIA metric indicates a worrying level of stagnation in the asset’s network.Such stagnation makes it difficult for the price of this asset to experience significant growth.

Since the merger, most ETH holders have seen losses on their investments. The alt’s market value to realized value (MVRV) ratio fell sharply from 5.4% on Sept. 14 and has since traded below the 0% midline. At the time of writing, ETH’s MVRV ratio is negative at -16.13%.

ETH was changing hands at $1,286.43 at press time. Since the merger 36 days ago, the price is down 21%. was clearly declining. At the time of this writing, ETH’s weighted sentiment was -0.317. Bearish sentiment has dogged the altcoin since the merger was completed.

Where might the price go next?

ETH was nearing the oversold zone at press time. Key indicators have been placed below their neutral zones. alt’s Relative Strength Index was 42.47 at press time. Its Money Flow Index (MFI) maintained its place at 35.19.

Once these indicators reach the oversold territory, a reversal could occur as the sellers would have exhausted themselves. On the other hand, Chaikin cash flow has been spotted at the neutral zero level, suggesting that buyers may be preparing to initiate this correction.

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