In the event you zoom out ETH’s chart, you’ll discover that its efficiency in July is similar with its efficiency in March. May this efficiency provide some insights into how ETH will carry out in August?
ETH’s newest rally kicked off in mid-July and managed to push the crypto up by as a lot as 74%. Extra importantly, its value appeared to be caught in a low-volatility vary after its sharp crash from April to June.
Equally, ETH rallied by roughly 42% from round mid-March, after being caught in a low-volume vary. It was preceded by a pointy crash between November 2021 and January 2022.
Supply: TradingView
If ETH follows the same sample because it did in March, then August ought to ship a bearish efficiency. Though that is totally doable, many of the dynamics at present driving its value motion are completely different now, in comparison with what was the case in March.
The 2 sides of the coin
One of many primary variations is that ETH has virtually doubled its drop from the ATH. Ethereum plans to roll out the ultimate testnet known as Goerli in direction of the top of the primary week of August. The mainnet Merge is predicted to happen in September. This implies August is a vital month for the community and the altcoin.
Cryptocurrencies usually rally a number of weeks earlier than their native networks undergo a significant improve. The Merge is the most important community improve in Ethereum’s historical past. By the identical premise, we are able to count on ETH to draw a variety of consumers within the weeks forward of the Merge. Maybe, this can even encourage traders to carry on to their ETH, reasonably than promoting earlier than the Merge.
The aforementioned expectations are according to ETH flows, particularly over the previous couple of days. Regardless of its rally, nonetheless, the variety of energetic ETH addresses and receiving addresses fell barely within the final 4 days. That is doubtless as a result of traders anticipate some promote strain close to the present month-to-month high.
Supply: Glassnode
New addresses and addresses holding greater than 1,000 ETH additionally dropped, however they’ve already began recovering.
This confirms that the demand for ETH is robust, particularly now that the community is within the final stretch earlier than the Merge date.
Supply: Glassnode
Conclusion
The Merge’s impression on ETH’s value motion can’t be understated. Nonetheless, traders ought to word that ETH remains to be closely pegged to the remainder of the market. Ergo, a number of pricing elements will affect its efficiency. Nonetheless, a significant drop can be seen as a possibility for traders to scoop up ETH at a reduction. Such a state of affairs means ETH would doubtless preserve a wholesome flooring value.
