The price of Ethereum (ETH) recently returned above $4,000, setting a new all-time high five days ago.
The trend of Ethereum
The price had already risen above this level shortly before mid-May, but only remained there for two days, on the 12th and 15th. It then fell, along with all cryptocurrencies, to a low of below $1,800 on July 21.
Since then, the price has risen by 133%, and has now been hovering around the $4,000 mark for six days, although it momentarily dropped below it on the 22nd, 23rd and 24th.
The current trend therefore differs from that of mid-May, when only on two single days did the price briefly remain above this psychological threshold.
According to Santiment, the current scenario would allow the price of ETH to remain above $4,000.
👍 #Ethereum is still hovering at an impressive $4,230 market price. Address activity showed impressive sustainability through a normally slow weekend, & though token circulation has been flat, on-chain metrics are justifying prices remaining above $4k. https://t.co/ImcJt3jlCc pic.twitter.com/UutLKrG2rU
— Santiment (@santimentfeed) October 26, 2021
Currently, it is actually hovering around $4,200, just below the all-time high of over $4,350 a few days ago.
Why Ethereum will stay above $4,000: Santiment’s metrics
“Address activity showed impressive sustainability through a normally slow weekend, & though token circulation has been flat, on-chain metrics are justifying prices remaining above $4k”.
The chart posted shows the 30-day moving average of both the number of active addresses on Ethereum’s blockchain and the total volumes of ETH in circulation each day: both of these curves appear to have been almost flat since the end of July, although large changes are clearly discernible on individual days.
However, since mid-October, the moving average of the number of daily active addresses has shown a clear upward trend, in some ways similar to that of the first half of September. But while the price was falling then, in recent weeks it has been rising, so the scenario is decidedly different.
In contrast, the daily ETH circulation curve has been falling slightly since the beginning of October, which is probably why Santiment assumes that the current situation seems so stable as to justify keeping the ETH price above $4,000.
In particular, compared to mid-May, the volume of ETH in daily circulation is now lower, while the number of active addresses is significantly higher. This suggests that there are now more small retail investors in action than there were then. Whales, on the other hand, may have started to wait for possible rises in order to sell what they have accumulated in recent months.