Ethereum flipped its bearish trajectory on Thursday and is having one of its biggest surges.
The day started at $3,072 and was negative earlier in the session. This changed a few hours ago as the asset shot up. It broke above the $3,200 resistance and continued upward in a bid to break above $3,400. However, it faced notable selloffs at $3,390.
It is up by over 9%, and it has erased the losses it incurred over the last seven days. The latest surge comes after the asset’s price action in the previous 48 hours. It dipped from $3,209 on Tuesday to a low of $3,031 in the last intraday session.
Indicators like the moving average convergence divergence and the Bollinger hinted at a further decline. Onchain data were bearish, and prices threatened to drop below $3k. What changed?
Demand Resurgence
Ethereum was on the verge of a massive decline following its fourth attempt at the $3k barrier since Nov. 14. The mounting pressure became intense until the apex altcoin suddenly changed market sentiment.
The accumulation and distribution chart shows a massive increase in buying volume. The sharp spike is surprising to many. However, onchain data clarifies what transpired over the last 24 hours.
A huge number of wallets were in profit, around $3k. Over 312,000 addresses were notably up at this price, and a drop would make them negative. The bulls were locked in a struggle to prevent such a decline. The latest drop threatens the status of these wallets, resulting in a massive pushback.
The resurgence in demand reflects in the increase in large transactions. Transfers exceeding $100k were at 7331. However, the figures changed by over 20% over the last 24 hours. Exchange netflow is no longer negative. It was at -$63 million on Nov. 19 but surged to $21 million during the previous intraday session.
Ethereum’s price correlation with Bitcoin also plays a massive role in the ongoing price trajectory. The correlation metric currently sits at 0.92. In summary, the asset is presently bullish as it sees notable demand concentration and more whale activity.
Declining Exchange Reserves of Ethereum
CryptoQuant data shows that traders are flocking to trading platforms to buy ETH. The exchange reserve of the apex altcoin has since started dwindling. The trend began with slight declines during the previous intraday session and progressed into the current session.
The growing buying pressure resulted in less Ether inflow to exchanges. Investors are not moving their assets from cold storage; the inverse is the case, as the number of assets leaving these platforms is over 145% higher than the previous day’s. Transfer volume has significantly reduced amidst the growing number of active wallets.
Traders from different regions are currently bullish. US traders are largely bullish as they flood the market with intense buying pressure. Coinbase premium is positive due to this trend. This is the same sentiment with traders in Korea. The Korea premium is green. However, ETFs are yet to pick as funds premium remain negative.
The derivatives market is teeming with life as the buying sentiment remains dominant. More buy orders are filled by takers. The bullish traders are increasing their creep on their positions with more funds, and the funding rate is increasing.
The bears anticipate further price decline and open fresh positions at the peak. Other bullish activity and counter-bullish action drive open interest up by 13%. Nonetheless, short position holders are the top losers, losing a total of $57 million over the last 24 hours against the long’s $31 million.
Onchain indicators like the stochastic and relative strength index are currently neutral, hinting at room for more price increases.
