It’s likely that Ethereum will hit this price level by end of 2021

With over 10% daily gain in Ethereum’s price, the altcoin is headed to price discovery beyond the latest ATH of $3955. The price crossed $3200 on May 3, and within less than a week, the price is in discovery mode. The altcoin’s MVRV-Z score, which is the ratio between market cap and realized cap, and standard deviation of market cap, is now at its highest point since January 2018. This is a bullish signal for Ethereum in the long run. 

ETH MVRV-Z ratio || Source: Twitter

Even at the current price level, according to on-chain analysts, ETH is undervalued. It is anticipated that the Triple-Halvening will lead to ETH’s price rally. The Triple-Halvening is the upcoming equivalent of 3 halving events for ETH, which will result in a 90% drop in sell pressure from miners.

A drop in selling pressure is bullish for ETH, since the concentration by large HODLers makes a cascading sell-off likely. With an increase in daily transactions on the network, driven by the increasing popularity of automated market makers such as SUSHI and UNI, swapping tokens is bullish for ETH. Additionally, DEX’s are now accounting for a total of $432 Billion worth of trading volume on ETH in the last 12 months and there are over 2 Million addresses trading on them.

Besides addresses trading on DEXes, the number of Ethereum addresses receiving from spot exchanges, the 7-day moving average has hit a 3 year high of 1655.57. The previous 3-year high was hit early in January 2021. This is significant to the altcoin’s price rally since the demand across exchanges and participating traders largely drive the price. The concentration is low when it comes to large HODLers, ETH

Based on data from Skew, and the above metrics, the probability of ETH’s price crossing $6000 before the end of 2021 is now 19%. This probability has changed throughout the rally and can be observed in the following chart.

ETH Probability of price hitting $6000 before end of 2021 || Source: Twitter

Though the probability of crossing $5000 is higher based on the above chart, crossing $6000 would put Ethereum much above other altcoins. At that rate of growth in ETH’s price, the current price level is the ideal buy zone in the interest of retail traders.