Ethereum Price Analysis: Overvalued Metrics Suggest Possible Correction Amid High Buying Pressure

  • Ethereum’s price has fallen by over 2% in the past week, reflecting market turbulence.
  • An indicator suggests ETH may be overvalued.
  • Eagerly anticipated approval for ETH ETFs from the US Securities and Exchange Commission recently came through, generating discussion among investors.

Ethereum’s recent market performance raises questions about its valuation and future potential.

Is buying pressure high?

Prior to the ETF approval, ETH experienced significant investor interest and price volatility. However, this enthusiasm waned post-approval, leading to recent downturns.

According to CoinMarketCap, ETH’s value declined by more than 2% over the past week, with the altcoin currently trading at $3,814.82 and boasting a market cap of over $458 billion. In contrast to this downturn, crypto analyst Ali tweeted that 777,000 ETH (approximately $3 billion) had been withdrawn from exchanges since the ETF approval, suggesting high buying pressure.

However, COINOTAG’s analysis of on-chain metrics presents a different narrative. Santiment data reveals a reduction in Ethereum’s exchange outflows last week. Simultaneously, its supply on exchanges expanded, indicating ongoing investor sell-offs.

The decrease in the supply held by top addresses further implies that significant stakeholders, or whales, have been selling off their ETH, highlighting the struggle to sustain its price near the $4,000 mark.

Looking forward

As selling pressure increased, a key metric turned bearish for Ethereum. Analyzing Glassnode’s data, we found that the NVT ratio (Network Value to Transactions) for Ethereum saw a sharp rise on the 1st of June.

The NVT ratio is calculated by dividing the market cap by the on-chain transaction volume in USD. A spike in this ratio suggests that ETH is overvalued, potentially pointing to an upcoming price correction.

Examining ETH’s daily chart, the MACD (Moving Average Convergence Divergence) indicator showed a bearish crossover, reinforcing the likelihood of a price decline. Conversely, the Chaikin Money Flow (CMF) and Relative Strength Index (RSI) indicated positive signs. The CMF uptick and RSI’s position above the neutral level hint at potential price growth.


In conclusion, while Ethereum’s recent price movements and on-chain metrics present mixed signals, the broader market sentiments remain cautious. The increase in supply on exchanges alongside whale sell-offs could suggest further bearish trends, despite some indicators pointing to potential gains. Investors should remain vigilant and consider both macroeconomic factors and on-chain data when making financial decisions regarding ETH.

Don't forget to enable notifications for our Twitter account and Telegram channel to stay informed about the latest cryptocurrency news.

Latest News


PRO Analysis

Ethereum Price Analysis: Regulatory Delays and Market Sentiment Intensify Decline

The recent volatility in Bitcoin’s price has...

Discover the Future of Decentralized Trading: In-Depth Analysis of GNS Coin on Gains Network

Gains Network (GNS) is a decentralized trading...

Dogecoin Price Analysis: Potential Trend Reversal and Future Projections

Dogecoin's value has experienced a substantial decline...

BONK Price Analysis: Bullish Reversal Imminent as Key Support Level Holds

Amid fluctuating market conditions, BONK is displaying...
Gideon Wolf
Gideon Wolf
GideonWolff is a 27-year-old technical analyst and journalist with extensive experience in the cryptocurrency industry. With a focus on technical analysis and news reporting, GideonWolff provides valuable insights on market trends and potential opportunities for both investors and those interested in the world of cryptocurrency.

Solana Sandwich Bot Earns $30 Million in MEV Arbitrage, Fuels 15% DEX Volume Surge

The Solana ecosystem has witnessed an intriguing development with a sandwich bot reportedly accumulating over $30 million via MEV arbitrage. ...

Ethereum Whales Hold Record $241.635 Billion in ETH as Exchange Wallets Decline

The accumulation of Ethereum by the largest holders reaches a new peak. The top 100 non-exchange Ethereum...

Michael Saylor Declares Bitcoin as “Godzilla” Ready to Upend Fiat Financial System at BTC Prague

Bitcoin continues to make headlines as influential figures within the financial sector advocate for its transformative potential. ...