Ethereum has shown a remarkable price recovery in recent weeks, leading some analysts to suggest that this could be just the beginning of a promising trend for altcoin.
One of them recently shared an intriguing analysis regarding Ethereum’s price movement in a post on CryptoQuant. The focus of the analysis is “buy/sell“, which estimates transaction volumes for a specific cryptocurrency.
When this ratio exceeds 1, it indicates that the volume of purchases exceeds the volume of sales, which is often seen as a bullish sign suggesting that investors are willing to pay more for the asset.
Conversely, a buy/sell ratio below 1 means that the volume of sales is greater than the volume of purchases, which usually reflects bearish sentiment among investors as more sellers are willing to part with their assets at lower prices.
As shown in the highlighted chart, the 30-day simple moving average (SMA) of Ethereum’s bid/ask ratio has remained below the 1 threshold for the past several months. This trend indicates that there are more sellers than buyers, leading to an increase in the supply of tokens on the open market.
However, there has been a recent rise in the 30-day SMA after Ethereum found support just above the $2,100 mark. The buy/sell ratio of buyers has now reached its highest level since mid-June, suggesting that bearish pressure may be easing.
The analyst stressed that if the buy/sell ratio continues to rise, it could signal a change in favor of the bulls in the Ethereum market. This level of active buying could pave the way for a potential rally in altcoin prices.
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