Ethereum
Ethereum Transaction Size Drops 54%: Why It’s Not Bad News for ETH
- ETH could be near its lowest level after transaction sizes fail to increase.
- Even though the price could fall, traders are confident of a quick recovery.
On May 19, AMBCrypto observed that Ethereum [ETH] the average transaction size had fallen to $2,767. This is a decrease of 54.13% from the measurement at the beginning of the month.
At that time, the average transaction size was $5,893, according to data from IntoTheBlock.
For the uninitiated, Average Transaction Size checks in dollars the average transaction value for an asset on a given day.
Historically, spikes in this metric signal high user activity, particularly from large investors and institutions. But when he decreasesthis implies an absence of institutional interaction.
Institutions are out, retail is in
As such, the recent state of Ethereum implies the presence of a greater number of retail users. Apart from that, this indicator identifies potential highs and lows.
From the value mentioned, it was evident that ETH seemed closer to the bottom than the top. At press time, the ETH price was at $3,106, indicating that it had been hovering around the same range over the past 24 hours.
Source: In the block
From the analysis above, the price of the cryptocurrency could reach a higher value in the short term. However, other parameters must be taken into account.
As a result, AMBCrypto examined the change in net position of the Ethereum Exchange. According to data obtained from Glassnode, the net exchange position change has been in the negative region for most of the last 30 days.
ETH prepares for a big step forward
This metric tracks the 30-day change in supply held in exchange wallets. A positive value indicates that more coins are being exchanged.
On the other hand, a negative value indicates an increase in withdrawals from exchanges.
One thing we noticed is that the metric suddenly became positive on May 18. At the time of writing, the net change in ETH position was 81,715.
This increase could be a sign that Ethereum participants are reaping profits from last week’s 6.50% increase.
If this number continues to rise, the ETH price could drop below $3,000 before a potential rally occurs.
Source: Santiment
However, if exchange withdrawals intensify again, the price could begin a slow increase towards $3,500. In a very bullish situation, an increase to $4,000 could be an option.
Friday May 17, AMBCrypto reported how options traders expected the price of ETH to reach $3,600 between May and the end of June.
At the time of going to press, Data from Glassnode showed that the feeling had not changed. This is due to Put/Call Ratio (PCR) signals.
Is your wallet green? Check the Ethereum Profit Calculator
If the PCR is above 0.70, it implies bearish sentiment and there is more selling than buying.
However, a reading below 0.50 implies the opposite. At press time, Ethereum’s Put/Call ratio was 0.35, meaning most traders expect the cryptocurrency’s value to increase in the coming weeks.