Lessons Ethereum Traders Can Now Draw From Its Market

The Ethereum market has been limping lately due to continued attacks from the bears of the market. The asset had lost nearly 50% of its value from its high of $ 4,378 at press time. With ETH trading at $ 2,159, selling pressure dominated the charts. Ergo, it is only understandable that the price development at ETH has provoked the question – is that all for Ethereum?

These theories are highly controversial. The on-chain metrics remain confusing as market volatility has panicked many new investors. To get a clearer picture of the current state of the bull market, it is necessary to look back at the 2017-2018 bull cycle.

Recently, Santiment noted strong similarities between 2017-2018 and the current bull cycle. However, the conclusion is unlikely to excite many investors.

Will this bubble burst soon?

In 2018, when the market corrected after the bull run, many called it a bubble that had burst. With ETH dropping further, it’s hard not to find any similarities between the end of the last bull cycle and the current period in the market. Currently, the price of ETH follows the course of the 2017/18 price action, with bears still dominating the market.

Interestingly, the longtime owners of Ether are still profitable. This means that the asset is not yet undervalued. This may sound good, but it’s not as good as it sounds.

That result also means that there could potentially be more corrections in the market, and as the price sees a bearish divergence, the price of ETH could take another hit.

In addition, the supply on the stock exchanges reached an annual low, a sign of less pressure to sell. However, this was also seen during the 2017-2018 bull run when there was a similar decline until the market realized that “it’s all over for ETH now”. After that, they rushed back to the exchanges.

Although there are some similarities between the 2017-2018 bubble bang and the current market, Ethereum has grown exponentially since then. Ethereum can now be staked out, and with the addition of EIP 1559 to the blockchain, trends could emerge that could change the future of Ethereum.

Although network growth has lagged compared to the previous bull cycle, it could be due to high gas charges and alternatives to its DeFi ecosystem like Polygon and Fantom. However, it would be too early to say this bull cycle is over. That is the lesson Ethereum traders can learn from its market right now.

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