Many people make the same mistake when analyzing Ethereum market trends—over-relying on price charts. Recently, I saw someone complain that "crypto analysis is an IQ tax," and this view actually reflects a real phenomenon: many traders' analysis methods are indeed too one-sided.

Looking at the market performance from 2022 to 2023, during that major correction, many who only looked at technicals got caught in a trap. When the price hit support levels, it seemed like a perfect buying opportunity, but it continued to fall. Traders who endured that downturn later realized that the problem wasn't with the analysis method itself, but with the overly narrow perspective—ignoring the real on-chain ecosystem conditions.

This is the core value of crypto analysis. On the surface, seemingly similar rallies can have completely different driving forces. Some rises are driven by the emergence of blockbuster applications within the ecosystem, attracting genuine user and capital inflows, which tend to sustain the rally longer; others are short-term news-driven pump-and-dump moves, which may spike temporarily but then fall back.

If you only look at candlestick charts and trading volume, they seem similar. But through on-chain data—such as active addresses, on-chain transaction volume, and smart contract interaction frequency—you can identify which rallies are driven by real demand and which are just capital games. This methodology is not an "IQ tax"; rather, it’s an essential tool to cut through market noise. Recognizing real from fake trends helps you avoid many pitfalls.