- Ethereum (ETH) has recently made headlines as a significant negative netflow reflects an unexpected bullish trend amidst recent volatility.
- Over the past week, Ethereum has shown dramatic price fluctuations, with traders responding to market conditions with renewed optimism.
- According to CryptoQuant, the latest data indicates that about -60k ETH was withdrawn from exchanges, showcasing a strong shift in investor sentiment.
Ethereum’s negative netflows indicate strong investor accumulation amidst price recovery, with ETH trading at $2,838 and signaling bullish trends.
Ethereum experiences negative netflows
According to CryptoQuant, Ethereum’s Exchange Netflow for derivative exchanges has experienced a decline of almost -60k ETH for the second time in a week. This trend strongly indicates that investors are becoming increasingly bullish about Ethereum’s price potential.
With such massive negative netflows, it suggests that investors are actively withdrawing ETH from derivative exchanges. When netflows turn negative, it implies that traders are accumulating, with outflows outpacing inflows. Historically, such a significant drop reflects reduced selling pressure from large positions being closed, indicating bullish sentiments in the medium term. As such, with this market behavior, it’s safe to say that traders have turned bullish and expect ETH prices to recover.
What ETH’s charts suggest
With Ethereum’s netflow suggesting a shift in market sentiment, this shift is witnessed across the charts.
For example, Ethereum’s Buyer-Taker-Sell Ratio has surged and surpassed 1 over the past two days to settle at 1.06. This shows that more traders are buying ETH compared to those selling reflecting a higher buying activity.
This buying activity is more prevalent in the U.S. market, with the Coinbase premium index turning positive. After remaining negative, traders on Coinbase have turned to accumulating ETH after the recent dip.
Additionally, this bullishness is experienced across other exchanges, as evidenced by the declining supply ratio. This has declined to reach a yearly low of 0.13 implying that more ETH is getting off exchanges than inflows in higher numbers than seen over the past year.
Can ETH see a sustained uptrend?
Notably, with market sentiments turning bullish, ETH is well positioned for a sustained recovery. This is evidenced by the fact that Ethereum’s Stoch RSI has made a bullish crossover over the past day. A bullish crossover here suggests that ETH is experiencing sustained upward momentum.
The altcoin’s RSI has surged from 31 to 37, while its Moving Average (MA) was 41. The RSI is closing in on another bullish crossover. A crossover here will validate the uptrend, with ETH making more gains.
COINOTAG observed favorable conditions on ETH’s price charts. If these sentiments hold, Ethereum will reclaim $3,000. A breach of this level will strengthen the altcoin to attempt a run to $3,300, where it faces significant resistance.
However, with heightened volatility over the past week, if bulls fail to hold the market while macroeconomic developments turn unfavorable, it could drop to $2,720. A breach below this level will push it to $2,563.
