Key Points
- Active Ethereum addresses have seen a significant increase, correlating with a surge in U.S investor buying.
- Ethereum’s market metrics indicate potential for an upward trend, despite some bearish signs.
After a period of steady decline, the number of active Ethereum addresses has seen a sudden increase. This rise has been accompanied by a surge in U.S investor buying and an overall increase in market buying volume.
Ethereum’s Potential Recovery
At the time of writing, Ethereum appeared to be gaining momentum in the market, with a slight increase of 1.2% to trade at $2,712. However, for a bullish phase to begin, Ethereum must recover beyond its 15.81% drawdown. Despite this, several market metrics suggest that Ethereum, the world’s largest altcoin, could soon trend higher.
U.S Investors and Active Addresses
The number of active addresses on the Ethereum network has surged to 376,653 in the last 24 hours. This reversed a decline that began on 10 February, when active addresses were as high as 431,000. Active addresses represent unique addresses that sent or received Ethereum within a specific time window. However, this metric alone does not determine a bullish or bearish trend and requires correlation with other key indicators, such as transfer volume.
In the last 24 hours, transfer volume climbed by 120.53% from its previous low. Approximately 1.73 million Ethereum was transferred, up from a low of 1.68 million on 13 February. This buying activity appears to be predominantly linked to U.S investors, as indicated by the Coinbase Premium Index, which tracks U.S retail investors’ trading action compared to the broader market. The index registered its own uptrend.
In the derivatives market, the proportion of buying volume relative to selling volume has remained high. The Taker Buy-Sell Ratio, which measures the relative strength of buyers versus sellers, suggests bullish sentiment when above 1 and bearish sentiment when below 1. Currently, the ratio stands at 1.07, suggesting that buying activity may continue to increase.
However, the Fund Market Premium, a metric which measures buying or selling pressure using NAV and market price, indicates bearish signs. When the fund market rate drops below 0 and trends south, it suggests an increase in selling pressure. At press time, the rate stood at -0.9, indicating that some sellers remain active in the market. If this metric shifts, Ethereum could potentially rally without hindrance.
