Ethereum

The price of Ethereum largely recovered from this week’s flash crash.
Some call it a sell off in a secular bull market,
others call it buying the dip.
i call it: strong fundamentals, and by that i mean that the price surge is justified by demand driven dynamics.
Because of that we stick to our long term Ethereum forecast of $1000.

Talking about fundamental strength in Ethereum,
it is interesting to apply traditional relative strength ratios to cryptocurrencies. When analyzing traditional markets we look at the gold to silver ratio to identify which of the two is outperforming or to understand whether a bull market has started or ended.
In stock markets the S&P 500 to Russell 2000 ratio is popular as a gauge of risk (the small cap Russell typically outpeformers when investors are in ‘risk on’ mode).
When it comes to cryptocurrencies the most popular way among analysts is to compare market caps.
While that is a good indicator it is not the most valuable one in our view.
What really is valuable as an indicator is the price ratio,
for instance the Ethereum to the Bitcoin price ratio.
The reason why we prefer this ratio above a market cap comparison is that, bottom line, whatever the market cap, all that matters is price. The point is that price reflects supply and demand factors;
price is the point where supply and demand find equilibrium.
In March of this year, Ethereum’s relative strength moved to an “all-time high” right
In chart analysis terms we call it a “breakout.” As goes with most breakouts it tends to come back down to test the breakout point before moving higher as of that point. That is called a “confirmation of the breakout”
so it suggests that the uptrend will continues.
The “real deal” took place in May,
What all this means is that Ethereum is the clear winner, and that this ratio was able to forecast it in April and in May.
It also learns that readers can do their own research by looking for other ratios,
for instance Ethereum to Ripple or Ethereum to Litecoin to get an idea of the real outperformer. Relative strength tells much more than absolute prices.
thanks.