- Ethereum holdings on exchanges are at the lowest level in eight years, setting the stage for a surge in prices.
- Current bearish indicators suggest there may be room for further declines before a rebound.
The amount of Ethereum (ETH) held on exchanges has reached its lowest level in eight years. With the launch of the spot ETF imminent, we could see a huge supply shock, which could lead to a dramatic rise in the price of Ethereum.
But let’s check what the data is telling us.
Source: Glassnode
Will the Ethereum ETF cause a stir?
If spot ETFs get the big attention everyone expects, the initial impulse to buy Ethereum could quickly push prices higher, followed by a correction as the market adapts to new supply and demand dynamics.
Ethereum price is below both the 50-day moving average and the 200-day moving average and is trending downward. This alignment generally indicates bearish sentiment.
Source: TradingView
RSI is around 43, below the neutral line of 50 but not yet oversold territory (below 30).
This means that the price may fall a little further before reaching oversold conditions, which often occurs just before a price bounce.
89% of Ethereum holders are making a profit at the current price, which is a strong indicator of a healthy market.
Whales hold 51% of Ethereum, leaving a huge amount of Ethereum concentrated in a relatively small number of wallets.
Source: IntoTheBlock
Over the past seven days, there have been large transactions exceeding $100,000 totaling $32.81 billion, highlighting large institutional or large investor activity. That said, investors of all kinds are currently bullish on Ether.
The recent downward trend in the MVRV ratio may suggest that Ethereum is entering less overvalued territory and potentially more sustainable price levels, or even undervalued territory.
This cooling can be a healthy market correction and provide a more stable foundation for a bull market.
Source: Santiment
Read Ethereum (ETH) Price Prediction for 2024-25
For now, if Ethereum can hold above the recent support level of $3,670, it may attempt to break the $3,733 resistance level.
A successful breach above this could push the price towards the next psychological barrier of $3,800.