The recent market-wide uptrend that was sparked when Bitcoin broke above $7,000 yesterday has proven to be particularly beneficial for Ethereum, which has posted some massive gains as it continues outperforming BTC and most other major altcoins.
In the near-term, it does appear that this momentum will extend significantly further, as one fundamental indicator shows that ETH is undervalued at its current price and that it will soon rally higher.
This comes as the crypto approaches a critical technical level that bulls need to surmount, with a clean break above this level potentially fueling massive upside.
Ethereum Continues Rallying as Bulls Push It Towards $200
Currently, Ethereum is trading up over 7% at its current price of $171, which marks a notable climb from multi-day lows of $140 that were set this past weekend.
Today’s upswing marks an extension of that which was first incurred on Sunday evening, which is around the time when the crypto began pushing higher in tandem with Bitcoin.
ETH’s buyers, however, have proven to be more zealous than BTC’s, as the crypto has been consistently outperforming the benchmark cryptocurrency and is currently trading up just under 5% against BTC.
Analysts are now noting that the crypto is fast approaching its 200-day moving average, which is a critical level that could determine whether or not this ongoing upswing turns into a full-blown bull rally.
“Ethereum daily – First of the majors to retest MA 200 on this broader move,” one popular analyst noted in a recent tweet.
Image Courtesy of Big Cheds
This technical level, which currently sits around the lower-$170 level, could catalyze some significant momentum – should it be decisively broken above.
Fundamental Data Shows ETH is Currently Undervalued
Glassnode – an on-chain research and analytics group – explained in a recent tweet that Ethereum’s MVRV ratio shows that its current value should be roughly $202, while its market value is significantly below this.
“Ethereum’s MVRV Ratio, a metric used to assess if price is above or below ‘fair value’, currently sits at 0.8 – indicating that it is currently undervalued. ETH’s realized price is currently $202 while current market value is $164.”
#Ethereum’s MVRV Ratio, a metric used to assess if price is above or below “fair value”, currently sits at 0.8 – indicating that it is currently undervalued.$ETH’s realized price is currently $202 while current market value is $164.https://t.co/1Ds0PoTar9 pic.twitter.com/etfwk8t4WW
— glassnode (@glassnode) April 6, 2020
This suggests that the cryptocurrency’s ongoing technical strength could soon lead to a swift movement past $200, which would mark a notable climb from its mid-March lows that were set within the sub-$100 region.
Featured image from Shutterstock.