Ethereum signals potential upside despite rising exchange reserves
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Ethereum is showing multiple bullish signals that suggest a possible price recovery, despite recent market weakness and increasing exchange reserves. Over the past two weeks, ETH has declined nearly 20%, falling from $2,805 on February 23 to $2,200, erasing $80 billion from its market capitalization. However, technical indicators and whale accumulation suggest a potential reversal in the near term.
Crypto analysts highlight Ethereum’s adherence to the Wyckoff Reaccumulation Pattern, a market structure indicating accumulation before an upward move. Analyst Merlijn The Trader noted that Ethereum has entered the spring phase, often a bear trap that misleads sellers before a breakout. A successful rebound from current levels could see ETH targeting $4,000. Additionally, a bullish divergence on the 4-hour chart supports a potential move toward $2,700 as an initial upside target.
Beyond technical patterns, on-chain data reinforces bullish sentiment. Large-scale investors continue accumulating ETH, with one Ethereum whale purchasing 17,855 ETH worth $36 million at an average price of $2,054, bringing total holdings to $2.53 billion. This level of accumulation suggests institutional confidence in ETH’s long-term prospects.
However, increasing exchange reserves present a counterpoint to this bullish outlook. Analyst Ali Martinez pointed out that 610,000 ETH has been transferred to exchanges over the past two weeks, raising concerns about potential selling pressure. Historically, rising exchange balances indicate increased trader willingness to sell, which could cap upside momentum in the short term.
Despite Ethereum’s underperformance compared to Bitcoin, Solana, and XRP over the past two years, extreme bearish sentiment could act as a contrarian indicator, fueling a relief rally. With ETH trading at $2,200, up 6% in the past 24 hours, market participants will closely monitor exchange flows and price action to confirm whether Ethereum has found a local bottom and is primed for recovery.
Crypto analysts highlight Ethereum’s adherence to the Wyckoff Reaccumulation Pattern, a market structure indicating accumulation before an upward move. Analyst Merlijn The Trader noted that Ethereum has entered the spring phase, often a bear trap that misleads sellers before a breakout. A successful rebound from current levels could see ETH targeting $4,000. Additionally, a bullish divergence on the 4-hour chart supports a potential move toward $2,700 as an initial upside target.
Beyond technical patterns, on-chain data reinforces bullish sentiment. Large-scale investors continue accumulating ETH, with one Ethereum whale purchasing 17,855 ETH worth $36 million at an average price of $2,054, bringing total holdings to $2.53 billion. This level of accumulation suggests institutional confidence in ETH’s long-term prospects.
However, increasing exchange reserves present a counterpoint to this bullish outlook. Analyst Ali Martinez pointed out that 610,000 ETH has been transferred to exchanges over the past two weeks, raising concerns about potential selling pressure. Historically, rising exchange balances indicate increased trader willingness to sell, which could cap upside momentum in the short term.
Despite Ethereum’s underperformance compared to Bitcoin, Solana, and XRP over the past two years, extreme bearish sentiment could act as a contrarian indicator, fueling a relief rally. With ETH trading at $2,200, up 6% in the past 24 hours, market participants will closely monitor exchange flows and price action to confirm whether Ethereum has found a local bottom and is primed for recovery.