On chain data shows that the buy/sell ratio of Ethereum recipients has recently formed a crossover, which historically indicates that asset prices have reached their peak.Ethereum Maker buy/sell ratio recently crossed 280 day and 476 day moving averagesAs an analyst pointed out in a CryptoQuant post, the last time this crossover was formed was in May 2021, when ETH observed a bull market rebound at the top
On chain data shows that the buy/sell ratio of Ethereum recipients has recently formed a crossover, which historically indicates that asset prices have reached their peak.
Ethereum Maker buy/sell ratio recently crossed 280 day and 476 day moving averages
As an analyst pointed out in a CryptoQuant post, the last time this crossover was formed was in May 2021, when ETH observed a bull market rebound at the top. The relevant indicator here is the "Ethereum taker buy sell ratio", which measures the ratio between the buying volume and selling volume of the taker.
When the value of this indicator is below 1, it indicates that the selling volume of short positions or orders in the current market is higher than the buying volume of long positions or orders. This trend indicates that more sellers are willing to sell at lower prices in the current market, which means that selling pressure is dominant.
On the other hand, when the value of this indicator is higher than 1, it indicates that most people hold bullish sentiment, as long trading volume is greater than selling volume.
In the context of the current discussion, the actual indicators of interest are the 280 day and 476 day moving averages (MA) of Ethereum receiver buy/sell ratios.
This is a chart that shows the trends of these moving averages for this indicator over the past few years:
As shown in the above figure, the 280 day moving average of the Ethereum taker buy/sell ratio fell below the 476 day moving average last month. Interestingly, just when this crossover occurs, the price of the asset forms a local peak around $2100.
When the 280 day moving average falls below the 476 day moving average of this indicator, it means that the market sentiment is turning to a more bearish mood, because it indicates that the dominant position of the order takers in sales has increased.
Due to this reason, this crossover has been bearish on the value of cryptocurrencies in the past. From the chart, it can be seen that this type of crossover was last formed in May 2021, when ETH was at the peak of a bull market in the first half of 2021. At the same time as the crossover, the price of cryptocurrency reached its highest historical high value at that time.
Based on this, the latest crossover of Ethereum receiver buy/sell ratio MA may also prove bearish on prices.
So far, ETH has only fallen since the top was formed together with this indicator, so the cross effect seems to be already in effect. However, the values of these two moving averages are still very close, so there is a possibility of a reverse intersection in the near future.
By 2020, the intersection of these two types has formed multiple times in a row, until the bullish type of intersection ultimately wins and leads to a bull market in 2021, which may be the case here.
It remains to be seen whether the two moving averages will continue to diverge in the coming weeks, or whether they will merge again to form a reverse intersection.
Ethereum Price
At the time of writing, the trading price of Ethereum was approximately $1800, down 2% last week.
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