Ethereum Rainbow Chart

Ethereum Rainbow Chart

Sara White
Fact Checked
Sep 28, 2022

The Ethereum Rainbow Chart is a logarithmic regression model that dates back to the inception of ETH in 2014. The model helps investors find out whether the price of Ethereum is overbought or oversold based on historical price movements. It is a replica of the popular BTC Rainbow Chart but is less reliable because it has a shorter price history.

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What is the Ethereum Rainbow Chart?

In short, the Ethereum Rainbow Chart is a long-term valuation model for the Ethereum (ETH) network. It applies to all networks that follow the principle of Moore's Law. The model effectively uses a logarithmic growth curve to help forecast the future valuation and direction of the Ethereum price, comparing its relative strength to previous points in history.

You can view the live chart here.

How do I read the ETH Rainbow Chart?

While logarithmic regression models sound complicated, the ETH Rainbow Chart does a great job of simplifying the underlying message of the data. At a high level, the 9 different ranges in the model mean the following for the price of Ethereum:

  • Dark red – in the bubble zone
  • Red – historically overbought, should consider selling
  • Dark Orange – investors are FOMOing
  • Orange – becoming overbought
  • Yellow – HODL, meaning it is neutral
  • Light green – leaving the accumulation zone (to the upside)
  • Green – in an accumulation zone
  • Blue Green – buy zone, market is fearful
  • Light purple – drastically oversold and a great buying opportunity

Who created the ETH Rainbow Chart?

The ETH Rainbow Chart was created by an anonymous user on 4chan's /biz/ message board in early 2017. The original post has been deleted, but the chart can still be found on various forums and websites.

What is the difference between the BTC and ETH Rainbow Charts?

The biggest difference between the BTC and ETH Rainbow Charts is the time frame. The BTC Rainbow Chart dates back to 2010, while the ETH Rainbow Chart only goes back to 2014. This means that the ETH Rainbow Chart is much less reliable than the BTC Rainbow Chart.

Sara White

I fell into crypto during the 2017 mania and have been around ever-since. I know write, research and publish my own reports on the digital asset ecosystem.

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