Even with Ethereum’s strong run, with the coin hitting nearly $ 4,000, on-chain data shows that there is even more room for the bull rally to continue.
Ethereum All Exchanges Taker Buy Sell Ratio increases
As can be seen from a CryptoQuant article, the buy-sell volume of ETH has seen an enormous increase on all stock exchanges today.
The Ethereum All Exchanges Taker Buy Sell Ratio (or Volume) is an indicator that shows the relationship between the long volume and the taker seller volume.
Well, common sense says that since every trade needs a buyer and a seller, then how can there be a difference between the two quantities?
Well, in order to understand the concept of Taker buying and selling volumes, it is first necessary to understand the idea of Taker and Maker. Quoting the CryptoQuant data guide:
Taker: Taker trade refers to an order that is traded before it is added to the order book. All market order trades are takers.
Maker: An order that is included in the order book (e.g. a limit order) is referred to as a maker trade. These orders add volume to the order book and help “make” the market.
If these customers buy ETH at the price set by the manufacturers, the amount of coins traded will add to the sales volume of the customers. This volume is known as the “seller” because it can drive prices down.
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On the other hand, takers who sell to makers at the ask price can drive prices up and thus contribute to buyer volume.
The ratio between these two volumes is precisely the buyer-buy-sell ratio. If the taker’s buy volume is higher than the sell volume (i.e. the value of the indicator is above one), it means that more trades are taking place at the ask price. This shows that demand is increasing and prices are increasing.
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Now here is a diagram that shows what the value of this metric looks like for Ethereum at the moment:
The ETH metric increases | Source: CryptoQuant
A high value of the indicator, as it currently suggests that the purchase volume of the Ethereum takers greatly overwhelms the sales volume.
A similar spike was seen in mid-August and the price rose in response. If you believe the indicator, the current high value could also lead to a further upward movement.
At the time of writing, Ethereum is hovering just under $ 4,000, up 22% over the past seven days. The monthly profits for the coin are around 47%.
The following graphic shows the performance of ETH over the past three months.
The price of Ethereum is soaring as the cryptocurrency aims to test $ 4,000 | Source: ETHUSD on TradingView