Sustained inflows into Ethereum ETFs indicate high bullish sentiment among institutional investors. The outflow of Ethereum staking suggests that investors are increasingly taking profits. After hitting a nine-month high, ETH could move higher and test the all-time high resistance at $4,868.
Ethereum (ETH) rose 2% on Monday, surging above the main symmetrical triangle on sustained institutional interest through ETH exchange traded fund (ETF) investors. However, an increase in withdrawals across staking protocols could halt the bullish momentum.
Ethereum bullish momentum accelerates due to ETF inflows as staking outflows increase
The U.S. Spot Ethereum ETF extended its inflow streak to 15 days of positive flows last week, posting a record net inflow of $818.8 million, according to data from Coinglass.
The bulk of this flow was $523.1 million and $258.6 million into BlackRock's ETHA and Fidelity's FETH, respectively. With sustained inflows, cumulative inflows increased to $3.2 billion and $1.38 billion.
Notably, on Friday, Grayscale's ETHE turned to positive flows for the first time since its launch, recording net inflows of $7.2 million. This could be a major turning point for the Ethereum ETF, which currently has total net inflows of $2.27 billion.
Despite continued bullish sentiment from institutional investors via the ETH ETF, Ethereum foreign exchange reserves have been trending upward over the past four days. Reserves have increased by about 100,000 ETH (equivalent to about $400 million), indicating that Ethereum may come under selling pressure following recent price increases.
Ethereum Exchange | CryptoQuant
Additionally, the total amount of staked ETH has decreased by over 490,000 ETH over the past month due to increased outflows across staking protocols. Such outflows indicate that investors are either slowly benefiting from recent price increases or are losing interest in holding ETH long-term.
Ethereum Staking Flow | Into the Block
This is evidenced by recent activity surrounding Tron founder Justin Sun's Ethereum address. According to crypto analysis platform Spot On Chain, Sun's address applied for a withdrawal of 52,905 ETH from staking protocol Lido Finance.
Ethereum Price Prediction: ETH Could Rise to Test All-Time High Resistance After Reaching 9-Month High
Ethereum is up 2% after sustaining $90.44 million in liquidations in the past 24 hours, according to Coinglass data. Liquidated long and short positions accounted for $31.25 million and $59.19 million, respectively.
ETH tested the yearly high $4,093 resistance for the first time in nine months after breaking above the upper bound of the symmetrical triangle.
ETH/USDT daily chart
If ETH manages to break above the year-to-date high of $4,093 on a big move and establishes the upper triangle as a major support level, it could rally sharply and test the all-time high resistance of $4,868.
The Relative Strength Index (RSI) is trending upwards above the neutral level, indicating increasing bullish momentum. On the other hand, the stochastic oscillator is in overbought territory, indicating that ETH could undergo a correction.
If the daily candlestick closes below $3,550, the theory is invalidated.
Frequently asked questions about Ethereum
Ethereum is a decentralized open-source blockchain with smart contract capabilities. Its native currency, Ether (ETH), is the second largest cryptocurrency by market capitalization and number one among altcoins. The Ethereum network is tailored for building cryptographic solutions such as decentralized finance (DeFi), GameFi, non-fungible tokens (NFTs), and decentralized autonomous organizations (DAOs).
Ethereum is a public decentralized blockchain technology that allows developers to build and deploy functional applications without the need for a central authority. To facilitate this, the network leverages the Solidity programming language and the Ethereum virtual machine, allowing developers to create and launch applications with smart contract functionality.
A smart contract is a publicly verifiable piece of code that automates an agreement between two or more parties. Essentially, these codes self-execute the coded actions if a given condition is met.
Staking is the process of earning revenue from idle crypto assets by locking them in a cryptographic protocol for a specified period of time as a means of contributing to security. Ethereum transitioned from Proof of Work (PoW) to Proof of Stake (PoS) consensus mechanism on September 15, 2022 in an event dubbed “Merge”. This merger was an important part of Ethereum's roadmap to achieve high levels of scalability, decentralization, and security while maintaining sustainability. Unlike PoW, which requires the use of expensive hardware, PoS reduces the barrier to entry for validators by leveraging the use of cryptographic tokens as the core foundation of the consensus process.
Gas is a unit that measures the transaction fees users pay to conduct transactions on Ethereum. When the network is congested, gas can be very high and validators may prioritize transactions based on fees.
