# Average Price

Today, someone asked me a very simple question. What is the average price of ETH? Then he added, say from the time it started rallying. Even with the qualifier, I thought it is not an easy question to answer. But as I thought about it, I tend to understand that it is actually a valid question. Let me give a bit more context on the question. As you are possibly aware, that crypto fell hard for last couple of days. Especially ETH, after reaching the high of 624 on the 24th Nov, when the ETH2 got funded, it sold off heavily to the lows of 480. As on right now, the time of writing, ETH is trading at 522. So seeing this my friend ask the question what could be a average price (may be read fair value?) for ETH. This is a fundamental question for a security like a stock. In the case of a stock we can do a fundamental analysis and arrive at a valuation for the company by a variety of methods. But unfortunately for crypto, it is basically impossible to do.

<center> ![image.png](https://images.hive.blog/DQmdNypiX6PuYYLMQcqaSjShL1tBww5mpqvW4Zt1jKBofJ1/image.png) </center>

With the lack of fundamental analysis, we have to resort to some kind of technical analysis to get to an 'average price'. A fixed range volume profile is a analysis that was added fairly recently to TradingView can be quite useful for this purpose. A fixed range volume profile shows the distribution of up and down volume within a predefine date range. In this case yellow bars corresponds to the up volume and the blue bars corresponds to the down volume. This helps us show the distribution of the volume across the range of prices. The user can choose any price range and I chose from Nov 03 to Nov 25. This is simply because the last time ETH was at 50 EMA on Nov 03. 

EMA or Exponential Moving Average (Magenta line) is also a measure of an average price. In this case I have chosen a common period length of 50 days. The red line from the fixed ranged volume profile histogram is called the 'point of control', which is simply the mode of the distribution. In this case it is at 460. This signifies that most of the ETH bought (and sold, in this case) is around $460. Incidentally it is also very close to where the EMA was at the time, at $450. So when we converge on the same number using a variety of independent methods, there is probably some statistical significance to it.

In reality these level offer support and resistance. Meaning, multiple people watch these levels closely, so when the prices get there they buy (then the price rally) or if the level breaks, they sell more (then the price drops). This is the way technical analysis becomes a 'self-fullfilling prophecy'. This is not really a bad thing. It is basically a form of herd mentality which if used properly, can be useful to an individual trader.



_Disclaimer: This is NOT professional advice, this is all just my own opinion and experience. I am NOT a Certified Financial Adviser. Consult professionals for any financial, accounting or legal related questions you have._

_Charts are created in Tradingview.com, which is a free service._

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