- Ethereum reserves on exchanges are at an eight-year low, paving the way for a price surge.
- Current bearish indicators suggest there is room for further decline before a recovery takes place.
The amount of ether [ETH] held on stock exchanges has reached an eight-year low. With the upcoming launch of its spot ETFs, we could see a massive supply shock, and this could lead to a dramatic increase in Ethereum’s price.
But let’s see what the data tells us.
Source: Glassnode
Ethereum ETFs causing a stir?
If spot ETFs generate the massive interest everyone expects, the initial rush to buy Ether could quickly drive prices higher, followed by possible corrections as the market adjusts to the new supply and demand dynamics.
Ethereum’s price is below the moving averages over both the 50 and 200 periods and is trending downward. This alignment generally indicates bearish sentiment.
Source: TradingView
The RSI is around 43, which is below the neutral 50, but not yet in the oversold area (below 30).
This means that the price could fall a little further before reaching oversold conditions, which often happens just before a price rebound.
A significant 89% of Ethereum holders are making a profit at the current price, which is a strong indicator of a healthy market.
Since 51% of Ethereum is owned by whales, there is a huge concentration of Ethereum in the hands of a relatively small number of wallets.
Source: IntoTheBlock
There have been a large number of transactions in excess of $100,000 over the past seven days, totaling $32.81 billion, highlighting the massive institutional or large-scale investor activity. In other words, all types of investors are bullish on Ether right now.
Recent downward trends in the MVRV ratio could indicate that Ethereum is entering a zone where it is less overvalued, aligning with a potentially more sustainable price level or even undervaluation.
This cooldown could be a healthy market correction, providing a more stable foundation for the bull run.
Source: Santiment
Read Ethereum’s [ETH] Price forecast 2024-25
As things stand now, if Ethereum can hold above the recent support at USD 3,670, it would look to break the resistance at USD 3,733.
A successful break above could push the price towards the next psychological barrier at $3,800.