Ethereum Breaks Above $2,400: This Metric Points To Further Upside
08 Febrero 2024 - 11:00AM
NEWSBTC
On-chain data shows an Ethereum metric is giving a bullish signal
as the cryptocurrency’s price has broken past the $2,400 barrier
during the past day. Ethereum Has Continued To Leave Exchanges
Recently In a CryptoQuant Quicktake post, an analyst explained the
recent relationship between the Ethereum price and data of the
exchange netflow indicator. The “exchange netflow” here refers to a
metric that keeps track of the net amount of the asset entering or
exiting out of the wallets of all centralized exchanges. The
indicator’s value is calculated by subtracting the outflows from
the inflows. Related Reading: Analyst Reveals Potential Trigger For
A 32% Cardano (ADA) Rally When the flow has a positive value, the
inflows are overwhelming the outflows right now, and a net number
of coins is moving into the custody of these platforms. One of the
main reasons investors might deposit their tokens on the exchanges
is for selling-related purposes. This trend can potentially have
bearish implications for the asset’s price. On the other hand, the
negative indicator implies the holders are making net withdrawals
from these platforms. Such a trend suggests the investors may be
accumulating for the long-term, which would naturally be bullish
for the cryptocurrency’s value. Now, here is a chart that shows the
trend in the Ethereum exchange netflow, as well as its 14-day
exponential moving average (EMA), over the last few months: The
value of the metric seems to have been quite red in recent days |
Source: CryptoQuant As highlighted by the quant in the above graph,
the Ethereum price has observed an overall bullish trend in the
last few months as the 14-day EMA exchange netflow has mostly been
inside the negative territory. There have been some spikes in the
positive region. With these net deposits, the cryptocurrency has
usually encountered some degree of resistance, implying that these
transfers added to the selling pressure in the market. Recently,
the indicator has assumed red values for more than a week straight,
suggesting that investors have been constantly making net
withdrawals. The scale of the negative spikes has also been quite
significant this time, meaning that some whales are involved. Off
the back of this potential accumulation from the investors,
Ethereum has observed its recovery below the $2,400 level. Since
the netflow has continued to be quite negative recently, it’s
possible that this rally isn’t all the coin would see; there may
still be potential for further upside. Related Reading: Bitcoin
Coinbase Premium Is Negative: What It Means For Price Recovery
Spikes back into positive territory may be to watch for; however,
if the pattern followed in the past few months is to be believed,
they may cause the cryptocurrency to hit at least a local top. ETH
Price At the time of writing, Ethereum is trading at around $2,420,
up more than 6% over the past week. Looks like the price of the
asset has shot up over the last few days | Source: ETHUSD on
TradingView Featured image from DrawKit Illustrations on
Unsplash.com, charts from TradingView.com, CryptoQuant.com
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