Key Indicators Ether Price Set to Hit New All-time High

Ether’s price might have had a disappointing week after it failed to hold the $600 level. However, the network and cryptocurrency fundamentals are still solid. Traders are short on memory, so Ether’s price is still 45% higher than last month. 

It is useful to measure the criteria that reflect the Ethereum network’s use to distinguish whether the recent correction displays a temporary consolidation or a powerful ceiling caused by a lack of adoption.

Withdrawals from exchanges increased

The growth in withdrawals from exchanges can be due to multiple reasons. It could be because of staking, yield farming, and buyers sending their coins to cold storage. At the same time, a steady stream of net deposits indicates a willingness to sell short-term.

The futures premium has normalized

A trader can determine the level of bullishness by estimating how expansive futures are compared to the traditional spot market. Typically, 3-month futures trade at a premium of 1.5% or more compared to regular spot exchanges. 

Regardless of the decline, the indicator has remained above the low threshold of 1.5%. That means that professional traders are optimistic. 

Spot volume is recovering

Traders also follow a volume in the spot market. Typically, low volumes indicate a lack of confidence. So, significant price changes must be accompanied by a large volume of trade.

Recent volumes have been below average. However, traders should remember Ether confronted a challenging battle when it tested the $600 level. Therefore, expectations arose for the accommodation with low volume, until hitting a definite low of this cycle.

Additionally, the current average daily volume of $900 million mimics the mid-November figures. Still, traders will only rely on price rallies accompanied by daily trading volumes above the $2 billion.

Option sale/purchase ratio

A trader can define the overall market sentiment by measuring whether there is more activity through call options or put options. Often, bullish strategies use call options. Meanwhile, put options are used for bearish ones.

A sell/buy ratio of 0.70 shows that open interest in put options lags 30% behind the more bullish call options. Therefore, market sentiment will be bullish.

Besides, an indicator of 1.20 favours put options by 20%. It is considered a bearish sentiment. 

As the price of Ether nears $600, investors often look for downside protection, rising the Sell/Buy Ratio. Interestingly, the indicator continued to climb over the past few days, nearing its 30-day high at 0.95.

Investors are not very excited, nor are they bearish

Currently, no indicator is triggering the alarms. Therefore, one shouldn’t consider the recent unfavourable price fluctuation a trend reversal.