Summary: When Will Ethereum Turn Overheated? Report Says Watch This Level

Ethereum is on the brink of entering an "overheated" market phase, according to a recent report from Glassnode, an on-chain analytics firm. The report highlights a historically significant price level that investors should closely monitor, as breaching it could trigger substantial profit-taking and market adjustments. Glassnode's analysis utilizes three key on-chain valuation models: Realized Price, True Market Mean, and Active Realized Price. All three indicate that Ethereum holders are currently "in the green," meaning they are holding profits. However, the focal point is the +1 standard deviation band of Ethereum's Active Realized Price. This specific level has previously acted as a threshold where selling pressure significantly intensifies, driven by investors realizing considerable profits. Historically, Ethereum’s interaction with this band has been telling. In March 2024, ETH tested this boundary but faced rejection. Conversely, during the 2021 bull run, the cryptocurrency surged past it, ushering in an "unsustainable euphoria market phase" before a correction. Currently, this critical +1 standard deviation level stands at approximately $4,500. While Ethereum is trading around $3,600, having seen an almost 7% increase recently, a continued bullish momentum could very well push it to retest this pivotal mark. Should ETH's uptrend persist and speculative gains multiply, the market could become "overheated," leading to increased profit-taking sell-offs. This makes $4,500 a crucial benchmark for anticipating Ethereum's next major price action.