Here's What Ethereum's On-Chain Indicators are Saying | Credit: Hameem Sarwar
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Key Takeaways[/focus-text-]
Ethereum’s MVRV Z-Score gives a bullish reading.
The SOPR has crossed above 0 for the first time this year.
Ethereum’s NUPL crossed into positive territory and above 0.3.
Ethereum’s on-chain data shows signs of strength, since key indicators have turned bullish for the first time in months.
Metrics like the MVRV Z-Score, SOPR, and NUPL are now aligned in a way that has historically preceded rapid price appreciation, hinting at a rally ahead.
Ethereum’s MVRV Z-Score
The MVRV Z-score is an indicator that shows whether the price of an asset is over- or under-valued.
The on-chain indicator compares the market to the realized value to understand the fair value.
Periods when the market value is considerably higher than the realized value have historically coincided with market cycle tops.
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Both previous Ethereum cycles had MVRV Z-score highs above 6, while the current one has only had a high of 2.
Based on this reading alone, it makes sense that Ethereum’s cycle high is not in place, especially considering that ETH has not reached its all-time high.
However, that is not the bullish signal that has caught many traders’ attention. Instead, the signal comes from an indicator movement in positive territory.
This signal has transpired thrice until now (black circles), leading to notable rallies each time.
The indicator just crossed above 0, so the ETH price might be ready for a parabolic rally to a new all-time high.
Ethereum’s SOPR
Another on-chain indicator that suggests Ethereum is readying for a dizzying rally is the Spent Output Profit Ratio.
The indicator divides the tokens’ realized value by their value at creation, attempting to determine whether the market is in a state of profit or loss.
Historically, a movement above one after a prolonged period below it has nearly always led to sustained upward trends. The only exception happened in August 2022 (black circle).
The current signal is even more bullish, since the SOPR moved above one and then returned to validate it as support (red arrow).
Therefore, Ethereum’s price is due for a sharp rally if previous history is followed.
Positive NUPL Reading
The final on-chain Ethereum bullish indicator is the NUPL, which measures the difference between unrealized profits and losses.
This on-chain indicator gives a similar signal in which the price starts rallying once the NUPL moves into positive territory (from red to orange), and then gets confirmed when it moves above 0.3 (orange to yellow).
Disclaimer:
The information provided in this article is for informational purposes only. It is not intended to be, nor should it be construed as, financial advice. We do not make any warranties regarding the completeness, reliability, or accuracy of this information. All investments involve risk, and past performance does not guarantee future results. We recommend consulting a financial advisor before making any investment decisions.
Valdrin Tahiri is a cryptocurrency analyst and reporter at CCN, specializing in technical analysis with a focus on Elliott Wave theory, on-chain metrics, and fundamental research. He brings over seven years of experience in the crypto space as both a trader and writer.
He discovered cryptocurrencies in 2017 while earning his MSc in Financial Markets at the Barcelona School of Economics, which sparked a deep interest in blockchain and market dynamics. Since then, he’s contributed to top crypto outlets like BeInCrypto and CoinGape.
Valdrin also served as Community Manager of BeInCrypto’s Telegram group for three years, helping grow it into one of the largest crypto communities worldwide. His expertise in market structure and price patterns allows him to break down complex trends into clear, actionable insights.
He’s published thousands of articles covering altcoins, Bitcoin cycles, and macro trends.
