Tim Beiko, Ethereum’s core developer, confirmed in a May 30 tweet that the eagerly awaited switch from proof of work to proof-of stake can be expected “around June 8, or so.”
It is interesting to note that Ether’s price action has remained relatively stable despite the bullish announcement. Although there was a +10% spike on May 30, those gains were reverted between May 31st and June 2. This event is likely to have yet to be priced in, which could give traders and investors an early entry advantage.
It is vital to keep track of on-chain data
The cryptocurrency markets are a significant disadvantage from a trading and investing perspective, as they lack transparency and regulated markets. Stock market disclosures are numerous and required. The stock market allows retail traders to identify how many shares of a stock have been sold, which institution purchased (or sold) large amounts of stock, and what insiders sold or bought.
These types of requirements are not applicable to cryptocurrency markets. The public is not able to tell if the Bitcoin (BTC), or Ethereum being traded on an exchange are the actual cryptocurrency, or an internal derivative that facilitates liquidity. Crypto markets offer something more than the stock exchange, and that is on-chain information.
Investors and traders can monitor the network activity of a blockchain using on-chain data. It answers questions such as: How many Ethers are being sent to an Exchange? Are there large transactions? Are there any larger or smaller “whale” wallets? The on-chain data can be used to determine if a trader should be bullish, or bearish.
The data on-chain that measures inflows and exits can often be used to determine whether a cryptocurrency’s bias is bullish or bearish. Inflow measurements indicate cryptocurrencies entering an exchange via outside wallets. They are often interpreted as a sign that there is incoming selling pressure. Outflow measurements refer to cryptocurrencies leaving an exchange to external wallets. They are often interpreted as a sign that cryptocurrencies are being held or accumulated.
Inflow transactions have remained relatively constant over the last three months, although there has been a noticeable decline since May’s middle.
Change in Inflow 24h: -13.50%Inflow 7 day change: 5.87%Inflow 30-day variation: -8.08%
Aggregated inflow transactions count. Source: intotheblock
The number of outflow transactions have decreased since March. There was also a significant outflow spike on May 12th, the date of the latest Ether flash crash. This was followed by a resumption in a decrease in outflows.
Outflow 24-hour change: +3.62%Outflow 7 day change: +8.87%Outflow 30 day change: -1.56%
Aggregated exchange transaction count. Source: intotheblock
It is important that outflows have increased while inflows decreased since May 29. This could indicate that large amounts of money are accumulating.
Related: Three key indicators that traders use to predict when altcoin season starts
The Ether price is at historic lows, while oscillators remain at swing lows
Merge is the biggest Ethereum event in history. Rarely does the world’s second-most valuable cryptocurrency remain at its 200-day lows, or down more than 60% from its peak.
The relative strength index and composite index are perhaps the most relevant and important details for Ether.
Although the weekly relative strength index is still in bull market conditions it is just above 40, which is the last oversold level. The current value 42.15 is the lowest recorded since March 18, 2019,
The composite index is also at an all-time low. Connie Brown developed the composite index. It is basically the RSI plus a momentum indicator. It can capture divergences that the RSI is unable to. It is the third-lowest weekly composite index value in Ethereum’s history, and the lowest since March 26, 2018.
Weekly chart of ETH/USD (Coinbase). Source: TradingView
Investors and traders can see reasons to be bullish on Ethereum in the short term due to extreme oversold readings, a rise in outflows, and a reduction in inflows. Any potential bullish reaction to Ether will be quick and sudden, but it will be limited to $2,600 volume point control in 2022.
com. You should do your research before making any investment or trading decision.