ETH Price Data Suggests A Forthcoming Rally Aiming To Surpass The $3,400

Three crucial Ethereum price metrics indicate that ETH is poised to rally above $3,400. 

Source: www.forbesindia.com

Despite an 18% drop to $2,826 from July 1 to July 8, Ethereum has begun to recover. Investors were disheartened, with $313 million in leveraged long positions liquidated during this period. Although the current price sits at $3,100, which is below the previous support level of $3,400, Ethereum traders are showing renewed confidence, supported by on-chain and derivatives metrics.

The ETH Amount Held on Exchanges Continues to Decrease

Even if the launch of a spot Ethereum exchange-traded fund (ETF) in the United States is delayed, the strong fundamentals suggest a potential price rebound in the near future. Gary Gensler, Chair of the US Securities and Exchange Commission, recently mentioned that approvals for S1 filings are anticipated sometime in the summer, potentially before the end of September. However, the precise timeline remains uncertain, leading traders to approach the news with cautious optimism.

Meanwhile, the anticipation for Ethereum ETFs grows amidst significant inflows into similar spot Bitcoin ETFs, totaling $654 million over the past three days. Matt Hougan, Chief Investment Officer at the exchange, has projected that spot Ethereum ETFs could attract as much as $15 billion in inflows within the first 18 months of trading. Analysts believe that even if this estimate is conservative, it will likely benefit the Ether price, considering a substantial portion of the supply is locked in staking and decentralized applications (DApps).

On-chain analysis by Leon Waidmann reveals that 40% of Ether's total supply is locked, encompassing staking and DApps usage. Concurrently, exchange deposits of Ethereum have decreased from 13.34 million ETH to 12.21 million ETH over the past two months, indicating reduced availability for immediate trading. This trend suggests that investors may be less inclined to sell in the short term. The Ethereum network's Total Value Locked (TVL), measuring deposits in its DApp ecosystem including layer 2 bridges, remains stable at 17.7 million ETH, unchanged from a month ago. This data underscores Ethereum's resilience amid higher average transaction fees, which exceed $2, surpassing many competitors such as Solana (SOL) and BNB Chain (BNB).

The ETH options put-to-call volume ratio data showed a modest increase to 0.8 on July 8, indicating that the volume of traded ETH put options was 20% less than call options. However, this indicator soon returned to its 7-day average of around 0.55, favoring call option volumes by 85%. Both derivatives and on-chain metrics indicate bullish momentum, while the decrease in ETH available for trading on fiat exchanges supports a potential short-term price rise above the $3,400 resistance level.

Disclaimer: FameEX makes no representations on the accuracy or suitability of any official statements made by the exchange regarding the data in this area or any related financial advice.