Ethereum Bullish Signal: Exchange Inflows Decline To Low Values
July 30 2022 - 3:00PM
NEWSBTC
On-chain data shows the Ethereum exchange inflows have declined to
low values recently, a sign that could be bullish for the crypto’s
price. Ethereum 7-day MA Exchange Inflows Have Gone Down In Recent
Weeks As pointed out by an analyst in a CryptoQuant post, the ETH
price has been reversing up as the PoS merge comes near. The
“exchange inflow” is an indicator that measures the total amount of
Ethereum moving into wallets of all centralized exchanges. When the
value of this metric shoots up, it means a large number of coins
are being deposited into exchanges right now. Since investors
usually transfer to exchanges for selling purposes, such a trend
can be bearish for the price of the crypto. On the other hand, low
values of the indicator can suggest holders aren’t sending in many
coins to exchanges at the moment. Depending on whether they are
also withdrawing or not, this trend could be either bullish or
neutral for the value of ETH. Now, here is a chart that shows the
trend in the Ethereum 7-day moving average all exchanges inflow
over the past six months: The 7-day MA value of the metric seems to
have been going down in recent days | Source: CryptoQuant As you
can see in the above graph, the Ethereum exchange inflows sharply
rose up in June and hit a peak. The price simultaneously suffered a
big hit due to the selloff. Following this surge, the indicator’s
value started to observe a decline. Around when the ETH developers
announced the 19th September date for the PoS merge, the coin’s
price started making recovery as the inflows continued to trend
down. Now the metric finds itself at pretty low values. There has
only been one dip below the current values in 2022, which was back
in March. These rock-bottom inflow values can imply Ethereum might
see more bullish momentum in the near future as long as the selling
pressure remains muted. The chart also displays data for the “open
interest,” another on-chain indicator that measures the amount of
positions currently open in the derivatives market. It looks like
the ETH positions have recently seen some growth. An active futures
market can result in higher volatility due to excess of leverage,
and in this year so far, high open interest hasn’t been
constructive for the crypto’s price. ETH Price At the time of
writing, Ethereum’s price floats around $1.7k, up 12% in the last
week. Over the past month, the crypto has gained 56% in value. The
below chart shows the trend in the price of the coin over the last
five days. Looks like the value of the crypto has moved sideways
recently | Source: ETHUSD on TradingView Featured image from
Bastian Riccardi on Unsplash.com, charts from TradingView.com,
CryptoQuant.com
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