The top two cryptocurrencies by market cap, Bitcoin (BTC) and Ethereum (ETH), have rallied 70% and 56% this year, putting a significant margin over rival risky assets and dwarfing them.
Besides, Ethereum dropped significantly against Bitcoin.
Ethereum, which has risen above $ 2,000 in the past weeks, is trading at $ 1850 before the FED decision.
Noting that some data in ETH gives a correction signal, CryptoQuant analyst MACD warned investors.
Noting that errors in Ethereum transactions are on the rise, the analyst said that when transaction failures rise above 200,000, it indicates the market is overheating and often sees a price correction.
“There are two reasons why I am waiting for a fix in Ethereum.
1-Ethereum Transaction Failed: In the past, when Ethereum's transaction failures went above 200,000, it would indicate that the market was overheating and would often see a price correction. This number has been reached.
2- Ethereum Average Gas Limit: The Ethereum average gas limit allows users to set a maximum gas limit to prevent transaction fees from getting too high. If the gas limit is set too low, the transaction may not complete and fail, so higher fees are paid to avoid damage to gas costs.
In this context, the average gas limit has increased recently.
As a result, when we look at these two data, it seems like a short-term correction may come. "
However, looking at the BTC MVRV cycle indicator, the analyst noted that there is still room for further increases.
Considering the two signals signaling a correction together with the BTC MVRV cycle indicator, the analyst said, "Looking at the BTC MVRV cycle indicator, there seems to be still room for further gains and it would be a good idea to use the corrective market to accumulate."
*Not investment advice.