Ethereum on-chain metrics are giving bullish signals as the cryptocurrency’s price has surpassed the $2,400 barrier in the past day. In a CryptoQuant Quicktake post, an analyst recently explained the relationship between Ethereum’s price and the exchange netflow indicator data, showing an optimistic digital asset trend.
The “exchange netflow” metric tracks Ethereum’s net inflow and outflow from centralized exchange wallets. A positive flow suggests inflows exceed outflows, with a net number of coins moving into exchanges. This trend implies bearish implications, as investors typically deposit tokens for selling purposes.
On the other hand, a negative flow indicates net withdrawals from exchanges, suggesting investors are accumulating Ethereum for the long term, which is bullish for the cryptocurrency’s value. A chart shows Ethereum’s exchange netflow trend and its 14-day exponential moving average (EMA) over the past few months.
Source: CryptoQuant
The analyst highlights Ethereum’s overall bullish trend, as the 14-day EMA exchange netflow has mostly remained in negative territory. Although there have been some positive spikes, these typically encounter resistance, implying net deposits add selling pressure to the market.
Ethereum Netflow Negative For Over A Week
Ethereum’s flow has recently remained negative for over a week, suggesting constant net withdrawals from investors. The significant negative spikes signal whale involvement in potential accumulation. Ethereum has recovered below the $2,400 level because of this potential accumulation.
With the negative netflow continuing recently, Ethereum’s price has the potential for further upside. However, spikes back into positive territory may cause the cryptocurrency to hit at least a local top, following the pattern observed over the past few months. It will be important to watch for these shifts, as they could signal changes in Ethereum’s market sentiment and price trajectory.
Ethereum price today is $2,436.00 with a 24-hour trading volume of $10,951,279,198. Ethereum is up 0.61% in the last 24 hours.
Source: CoinMarketCap
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