Ethereum (ETH) now looks to be one of the strongest altcoins in terms of stability, confidently holding above the $3,000 mark for several days
The current resilience could give Ethereum (ETH) the necessary push to begin a recovery and breakout to new local highs.
Ethereum Investors Expect Growth
The price of Ethereum has dropped significantly over the past few days, following broader market trends.. However, the token remains above $3,000, giving investors hope that the price will rise.
This is due to the fact that most of the circulating supply of the coin is limited by the 20% rally. According to Global In/Out of the Money (GIOM), about 9.14 million ETH worth more than $27.4 billion were purchased between $3,537 and $3,118.
Ethereum and GIOM data. Source: IntoTheBlock
Given that this massive supply is within a relatively more modest rally, ETH holders are sure not to give up until these tokens turn a profit.
This sentiment is confirmed by the Net Unrealized Profit/Loss (NUPL) indicator.. This on-chain metric shows the potential profit or loss that investors could make if they were to sell an asset at the current market price.
When the NUPL value is high, investors are in profit and this indicates a potential sell-off; a low reading may signal favorable savings or buying opportunities. ETH is currently in the bullish zone, which has historically been a trigger zone for price rallies.
Ethereum and NUPL. Source: Glassnode
Thus, despite the correction, NUPL being in this zone is evidence that Ethereum still has the potential for a new rally.
ETH Forecast: Rebound from Support Level
Currently, the main task for Ethereum is to defend the $3,000 level and not lose it as support. Given that investors are currently very bullish, ETH has the opportunity to spark a rebound.
The most likely outcome is a potential 20% rally that would send the altcoin above $3,500. To do this, the price will first need to overcome the resistance at $3,376 and turn it into support. The completion of such a rally will help the aforementioned supply volume return to profit territory, which could encourage investors.
1-day ETH/USDT chart. Source: TradingView
On the other hand, if this critical support level is lost, Ethereum will fall and test the $2,736 mark. A break of this support will invalidate the bullish scenario and lead to a further fall in price.