Ether‘s exchange flux metric turned negative for the first time in history, signaling a shift in investor behavior and Ether’s potential to resume its uptrend.
Key takeaways:
- Ethers exchange flux balance turned negative for the first time, signaling aggressive accumulation.
- ETH price could rally to new highs above $5,000 if key resistance breaks.
Ether (ETH) is teasing a continuation of its bull cycle as the cumulative exchange net flow turns negative for the first time in history.
Is this the trigger required to push ETH price back into price discovery？
ETH exchange flux balance turns negative
Joao Wedson, founder and CEO of data analytics platform Alphractal, highlighted that Ethers exchange flux balance has turned negative for the first time in history.
The exchange flux balance is a metric that tracks the cumulative net flow of ETH across all exchanges over time and how the flows change over time.
A positive value means more deposits than withdrawals, suggesting potential selling pressure. While a negative balance indicates that more ETH tokens are leaving exchanges than are deposited, it is a sign of accumulation and long-term holding behavior.
“Billions of dollars in ETH are flowing out of exchanges!” Wedson said in an X post on Friday, adding:
“This historic milestone could mark a major shift in ETH investor behavior!”
ETH exchange flux balance. Source: Alphractal
In other words, ETH is leaving exchanges at an accelerating pace. In particular, exchange outflows have increased since mid-July, reflecting significant accumulation and decreasing supply — both bullish signs.
ETH exchange net flows. Source: Alpractal
As Cointelegraph reported, overall exchange ETH balances are at their lowest in nine years. Ether balance on exchanges is 15.72 million ETH as of Friday, levels last seen in July 2016, per Glassnode data.
Bitcoin exchange reserve. Source: Glassnode
Reducing supply on exchanges means less ETH can be readily sold, potentially leading to a liquidity shortage and higher prices in the long term.
Ether price must reclaim $4,500 to secure recovery
As Cointelegraph continues to report, a key short-term resistance for ETH price remains $4,500, and the bulls need to flip this into new support to go higher.
Note that this level has capped the price since the ETH slipped to $4,300 on Aug. 29.
“$ETH broke out from the falling wedge, retested it, and now hovers above key support,” said crypto trader Jelle in a Friday post on X.
The trader pointed out that a decisive close above $4,500 would leave “very little standing in the way” of a move higher into price discovery.
“$5000 is just the beginning.”
ETH/USD four-hour chart. Source: Jelle
Fellow analyst Donald Dean shared a chart showing ETH price compressing in a tight range within a bull pennant, suggesting that a significant move was imminent.
A daily candlestick close above the upper trendline of the pennant at $4,500 is a must to confirm the breakout.
Based on Fibonacci retracement levels, Dean set the targets for the bull pennant at $5,766, $6,658, and $9,547.
$ETHUSD $ETH Ethereum - What do you see？
Price Targets: $5766, $6658, $9547
Consolidating in descending wedge, bullish pennant formation.
Price Targets set at ETH/BTC ratios:
$5766 at the 50% retracement
$6658 at the 618 Fib level
Several bullish signs suggest that ETH is well-positioned to break above $5,000 in the following days or weeks.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.