The Russell 2000, an index tracking roughly 2,000 smaller publicly traded US companies that is generally viewed as one of Wall Street’s more risk-sensitive equity benchmarks, has returned to record territory at over 3,050 over the past few weeks.

According to popular analyst Crypto Rover, there’s a hidden connection between the index and the largest altcoin, which could lead to a major ETH rally.

ETH Rally Ahead?

As the market observer highlighted, the Russell 2000’s surge to a new all-time high follows previous similar gains charted in 2016 and 2020. After both instances, ETH went on a massive rally within 6-12 months.

Given the index’s risk-on significance, when it surges, it means that investors have become more comfortable moving away from mega-cap stocks and into smaller companies. This is often interpreted as evidence that risk appetite and liquidity conditions are improving.

Here’s where Crypto Rover outlined the connection with Ethereum as the Russell broke out during previous cycles before ETH eventually followed with significantly larger percentage gains. Analysts at Milk Road previously described the correlation between the two as almost “spooky,” suggesting that both tend to benefit when monetary policy turns easier, which hasn’t exactly been the case lately.

Ethereum also offers staking yield, while its broader ecosystem is heavily exposed to speculative activity, DeFi, tokenization, and other areas that expand during risk-on periods.

Although the relationship between the two appears superficial at first glance, Ash Crypto also recently spoke about it and predicted a similar surge as Crypto Rover.

Time to Buy ETH?

The altcoin jumped toward $2,000 in July, but it was halted on both attempts. It has since lost about $100, currently struggling below $1,900. Nevertheless, it is still up by over 20% since its local low at $1,520.

Other analysts are also optimistic about its future price movements, including Michaël van de Poppe, who commented recently that the perfect moment to buy an asset like ETH never comes, but the ideal time to accumulate it is right now:

“It’s always awkward to be positioning yourself into a position, as that’s the purpose of the markets. Previous breakouts of the market have resulted in generally big returns, as ETH is known for volatile movements. In that sense, last time a 60% breakout in less than a week took place. In 2023, the same happened,” he explained.

Source: CryptoPotato