This Bitcoin indicator might dictate whether Ethereum hits its all-time high again

cryptocurrency golden coins 2 scaled

A lot has already been said about the London hard fork. It is set to initiate some major changes for Ethereum. With the upgrade going through a few hours ago, the question is – Where will the top alt’s price go from here? This is an important one, especially since ETH has rallied by almost 50% since 20 July.

While this might seem like an over-asked question, the truth is it’ll be too premature to predict Ethereum’s price for any timeframe. However, it’s still undeniable that there are some key factors that have been driving Ethereum’s price. In this article, we will be looking at some of them.

A Bitcoin in need…. 

Bitcoin’s price has been a driving factor behind the rallies seen by the market’s alts, Ethereum included. This time too, for instance, BTC’s upward trajectory towards the crucial $40k mark triggered a market-wide rally. Amid speculations of ETH price movement after London, analyst Benajmin Cowen recently pointed out,

“If Bitcoin is above the 20-week SMA and moving sideways, then it’s a relatively good outlook for the rest of the market.”

Alas, right now, Bitcoin is still below the 20-week SMA. Ergo, the chances of Ethereum making a move towards its all-time high of around $4400 are low. 

 
Source: Benjamin Cowen Youtube

According to Cowen, for new market ATHs, ideally, Bitcoin should be above the 20-week SMA which will come into play at around $43,611.

Now, Ethereum might go on an uptrend soon on the back of investor sentiment finally breaching its months-long downtrend. However, it is unlikely to come close to its ATH anytime soon unless Bitcoin finds a position above the aforementioned level.

What do the metrics say? 

A closer look at Ethereum’s Liveliness, alongside its price movement, highlighted that it has been touching new lows since 15 May. This is a sign of accumulation and hodler hands getting stronger across the market. 

Source: Glassnode

Further, the Dormancy for Ethereum peaked on 3 August. This was its highest peak since 18 May and highlighted that old coins moved ahead of the hard fork. The two metrics, together, suggest that on-chain activity is comparatively low on the network and investors are waiting and watching, before making any move.

The pattern presented by these metrics, in general, means that the price action won’t sustain itself and might even take a turn south. Even so, the bullish optimism associated with London and rising investor sentiment might have other ideas for the crypto.

Ronnie Huss

Ronnie Huss

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