Ether’s Bull Momentum Is Strongest Since May 2021

As a seasoned crypto investor with a few battle scars from past market swings, I’ve learned the hard way that catching falling knives is a losing game. The current state of the ether market presents an entirely different challenge – one where the strongest upward momentum in three years makes picking a top as risky as attempting to pick a bottom.

“The ethereum market is currently experiencing its most robust price surge in over three years, which is the antithesis of the cautionary market adage ‘don’t try to catch a falling knife.'”

Significantly, the second largest cryptocurrency’s momentum indicator, which quantifies the speed of price changes over a 10-day period, has surged to reach $880 – its peak since May 2021, based on data from TradingView.

To put it differently, the bullish momentum is robust and those looking to sell, if they exist, may find themselves trampled over. This also signifies that identifying a peak at this moment carries the same level of danger as trying to identify a bottom during a significant downturn – the risk being similar to attempting to catch a falling knife when an asset is in a freefall.

Traders employ the momentum indicator as a tool to validate market tendencies and identify divergences. When an divergence of a bearish nature emerges, it signifies that the indicator is no longer aligned with increasing prices. This discrepancy may suggest that the bullish trend is weakening and could lead to a correction or decline.

At present, Ether’s daily price chart indicates a concurrent increase in both the momentum indicator and the price (as depicted on the left), signifying an ongoing uptrend.

In simpler terms, the 14-day Relative Strength Index (RSI) on the lower chart has surpassed 70. This is considered a signal of growing bullish energy. Contrary to common belief, values above 70 do not necessarily mean the market is overbought. Instead, they signify robust upward trending. Values below 30, however, suggest an intensified price decline.

In simple terms, the 14-week Relative Strength Index (RSI) for right-handed assets is nearing the 70 mark, which has historically signaled intense bull markets.

Immediately following the $4,090 mark, there was strong opposition in April, which was then surpassed by the all-time high of $4,692 during the 2021 bull market. Traders on the decentralized platform Lyra anticipate a surge toward $5,000 by the end of Q2.