The price of Ethereum (ETH) has been facing a period of uncertainty, embodied in whale behavior and net transfer volume.
Over the past month, on-chain metrics have shown mixed signals, with inflows and outflows to exchanges indicating mixed investor sentiment.
Ethereum net transfer volume reflects uncertainty
The net Ethereum transfer volume to and from exchanges over the past month reflects a market struggling to find a clear direction. During this period, net inflows reached a monthly high of 140,000 ETH on September 19, indicating a significant inflow of Ethereum to exchanges.
This could indicate increased selling pressure and negative sentiment as investors prepare to liquidate their holdings. However, after this jump, net inflow volumes remained much lower, indicating less selling pressure.
There have been notable episodes of large outflows, such as those in mid-September and early October, where investors moved large amounts of Ethereum away from exchanges. Such outflows are generally considered positive, indicating that holders prefer long-term accumulation rather than immediate selling.
However, large inflows have also been observed, such as the one on September 12, which contributes to the general skepticism as it indicates a readiness for potential selling.
This metric, which captures the net movement of Ethereum between exchange addresses and individual wallets, provides valuable insight into market sentiment: positive net flows indicate negative sentiment as investors prepare to sell, while negative net flows (more Ethereum leaving exchanges) indicate positive sentiment as holders prefer to store their assets away from exchanges.
Between October 7 and 9, net flow remained positive for three consecutive days, meaning that more ETH was entering exchanges — a negative sign that suggests investors may be ready to sell. This negative streak, however, ended on October 10, when net flows turned negative, with -19,000 ETH leaving exchanges.
Alternating inflows and outflows, with no consistency in their volume, indicate a market that is still hesitant. This reflects investor hesitation about Ethereum and sentiment that is not fully committed to buying or selling.
Are Ethereum Whales Losing Trust?
Ethereum whales remained hesitant through mid-September. Then, between late September and early October, the number of addresses holding at least 1,000 ETH began to decline significantly.
This trend reached a monthly low on October 9, with just 5,590 addresses. The drop highlights a moment of uncertainty among large investors, suggesting that major players were pulling back from amassing large amounts of Ethereum.
This hesitation among whales may reflect concerns about market volatility or a general lack of confidence in Ethereum’s short-term potential. Large-scale declines in holdings often precede shifts in market sentiment, as whales have the financial power to move markets significantly.
Keeping track of the number of whale addresses is crucial because these addresses can have a significant impact on market dynamics. Whales are usually sophisticated or institutional investors, and their actions often provide insights into the direction of the market.
When the number of whale addresses decreases, it can indicate a loss of confidence in the asset. On the other hand, increased whale activity can indicate accumulation phases, which are often considered bullish signals.
Despite a spike between October 9 and 10, when the number reached 5,598, it is still well below the levels seen a few weeks ago. This suggests that whales may have lost confidence in Ethereum over the past few days and have yet to regain confidence in a price recovery, reflecting a cautious stance despite the slight recovery.
ETH Price Prediction: Is Ethereum’s Decline About to Reverse?
Ethereum’s exponential moving average (EMA) lines are currently sloping down, with the short-term lines below the long-term ones. However, one of the short-term EMA lines has recently started moving upwards. Although this is a small change, it could indicate that Ethereum is trying to reverse the current downtrend.
EMA lines are a useful tool for identifying the overall trend by smoothing out price data, and the recent upward movement in the short-term EMA line indicates a potential shift in market momentum. However, it is still too early to say whether this represents the start of a sustainable uptrend or just a short-term fluctuation.
The EMA lines provide valuable insights into potential price movements. If the downtrend continues, ETH price could test the support levels at $2,308 or even $2,250, which could indicate further weakness. Conversely, if whale activity increases and confidence returns, the emerging uptrend could see ETH price test the resistance levels at $2,467 and $2,563.
If the buying pressure is strong enough, ETH could reach $2,729, which would represent a 12% price increase. The EMA lines’ trends, as well as the whales’ behavior, will be key to understanding whether ETH can break out of its current range and resume the uptrend.
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