Potential Encouraging Signs for Ethereum as Markets Give Up Some Gains

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brianq
Aug 26, 2021

Ethereum has been relatively boring compared to the altcoin boom we've seen over the past month. Just take a look at how its performance has looked compared to the rest of the top 100 market cap pack.


Certainly no complaints with a +41% over the past 30 days, but it's still rather unassuming compared to the monstrous upswings many other assets have seen.


For this same reason, ETH is less of a risk to hold now compared to something like Cardano or other assets that have been absolutely roaring in the month of August. And with our on-chain metrics showing some encouraging signs, we'll take a quick look at what to keep an eye on:



Token Circulation

Ethereum's token circulation has just exceeded two-month high levels. The amount of unique tokens moving on the ETH network showing an increase here is a promising sign that if it does drop back below $3,000 again, it may not be for long if circulation sustains itself up at these increased levels.



Weighted Social Sentiment


Weighted social sentiment is a great tool to help indicate just how euphoric (or fearful) the crowd is getting. And after a fairly extensive 4-week stretch of Twitter being euphoric as Ethereum stormed its way back above $3,300, this chart is indicating that the crowd has finally edged into negative territory compared to historical averages. If this chart ticks down further into negative, it would be a great sign that a price bottom (dip buy opportunity) is on the horizon.



Mean Dollar Invested Age


Since late May, Ethereum's mean dollar invested age has been a pretty steady rise. But see the tan line beginning to dip down again over the past 3 days? This is an extremely promising sign, as it indicates that dormant dollars that were invested in quiet ETH addresses are beginning to move once again.


Notice what Ethereum's price did from late February to early May on the left side of the chart. Long story short, when this line begins to dip down, good things happen. We will just need to see if the down-trend continues to avoid seeing a fake-out of just a few encouraging days here.



Disclaimer: The opinions expressed in the post are for general informational purposes only and are not intended to provide specific advice or recommendations for any individual or on any specific security or investment product.



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brianq
Aug 26, 2021

Thanks for reading!

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