Opportunity? Ethereum, the “most bullish altcoin,” signals an imminent rally

Ethereum (ET) has attracted attention once again with its recent price movements and the emergence of a bullish model on his papers.

This pattern, often seen as a harbinger of further price increases, has sparked discussions among investors and analysts about Ethereum’s potential to revisit previous highs.

Over the past week, Ethereum has experienced considerable volatility, characterized by a 7% drop in its price. THE cryptocurrency the performance of the previous month was characterized by a strong bullish trend which significantly increased its price.

However, a recent correction has tempered short-term investor optimism. Despite this performance, analysts believe that Ether still remains one of the altcoins showing the greatest upside potential at the moment. Ethereum’s underlying fundamentals and market indicators suggest a potential upward trajectory.

Analyst perspectives and historical trends

Renowned analyst Yoddha pointed out that, historically, Ether’s return above yearly highs has often preceded exponential price growth. He suggests that if history repeats itself, ETH could embark on a parabolic uptrend with an upside target set around $20,000, making it “one of the most bullish cryptocurrencies.”

Ether’s bullish outlook is further supported by CryptoQuant data showing increased investor accumulation and significant outflows from centralized exchangesThis accumulation activity could be driven by bullish events on the horizon, such as the early debut of a spot Ether exchange-traded funds (ETF).

Ethereum outflow from centralized exchanges. Source: CryptoQuant

Analyst Ali Martinez noticed increased whale activity, with large holders taking advantage of recent price drops to accumulate more Ether. On-chain data from Santiment Shows Top 10 exchange wallets saw an 8.6% drop in ETH holdings as traders shifted assets to private wallets

This elevated demand-side pressure, combined with reduced supply on exchanges, will likely create a supply deficit that could push Ether price above $4,000 and into a parabolic uptrend.

Furthermore, according to data, over 200,000 ETH options have recently expired and the crypto community is eagerly awaiting the direction of Ethereum’s price.

Most expiring ETH options are call options, meaning buyers are betting that the price will rise. At the same time, the put-call ratio stands at 0.36, which indicates that market participants are currently buying more call options than put options.

Market indicators and analysis

In addition to outflows from centralized exchanges, fundamental and technical indicators offer insight into Ethereum’s current market dynamics and future potential.

A decline in Ethereum’s currency reserves indicates a reduction in available supply, suggesting strong buying pressure from investors.

A rising funding rate in the derivatives market shows that traders with long positions are willing to pay premiums to hold their positions, generally aiding upward price movements.

However, Santiment’s on-chain data shows a high Ethereum Network Value to Transaction (NVT) ratio, which compares market capitalization to transaction volume, suggesting that Ethereum may be overvalued relative to its on-chain activity.

Ethereum NVT Report. Source: Santiment/Finbold

This high NVT ratio implies that despite strong market interest and price action, on-chain transaction volume does not fully support Ethereum’s current valuation, indicating potential caution for investors.

Currently, Ethereum is trading at $3,562.24, up 0.23% over 24 hours. Demand for Ethereum is increasing, signaling that traders expect the price to continue rising in the near term.

Disclaimer: The content of this site should not be considered investment advice. Investing is speculative. When you invest, your capital is at risk.

Source