Amidst the broader cryptocurrency market rally, Ethereum (ETH) has been one of the standout performers. Data from exchanges indicate that investors continue to move ETH to private wallets, signaling a holding mentality and expectations of future price appreciation
Amidst the broader cryptocurrency market rally, Ethereum (ETH) has been one of the standout performers. Data from exchanges indicate that investors continue to move ETH to private wallets, signaling a holding mentality and expectations of future price appreciation.
Massive Exchange Outflows for Ethereum
Exchange data provides valuable insights into the supply and demand dynamics of crypto assets. When the supply of an asset on exchanges decreases, it suggests that holders have a longer-term outlook.
Trading data from IntoTheBlock reveals that as investors have been accumulating the second-largest cryptocurrency by market cap since the start of the year, the dynamics have been tilted in favor of demand.
Significantly, Ethereum exchange outflows totaled $906 million last week, marking the eighth consecutive week of outflows.
This week, $906M worth of ETH left exchanges, making it the 8th consecutive week of net outflows for the second-largest crypto asset.
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IntoTheBlock (@intotheblock) March 1, 2024
Comparable trading metrics on CryptoQuant further corroborate this outflow pattern. Since January 10th, Ethereum exchange reserves have dropped by over 1 million ETH, currently standing at 13.7 million ETH.
What's Next for Ethereum?
The large exchange outflows can be attributed to Ethereum bulls looking to push the cryptocurrency to new highs. ETH has been on a sustained uptrend for the past several months, outperforming most altcoins.
At the time of writing, the cryptocurrency is trading at $3,392, up 46% in the past 30 days. If anything, the increased exchange outflows serve as a signal of the ongoing uptrend, with ETH currently retesting the $3,500 mark after briefly crossing it on February 29th.
The bullish action has led many investors to anticipate that Ethereum will once again break past the $4,000 mark and journey towards its all-time high of $4,878. With exchange supply decreasing, ETH's price is likely to follow suit. A breakout above $4,000 appears imminent, from where it could swiftly rise to $4,900.
Cryptocurrency analyst known as Trader Alan notes that the recent price action has seen Ethereum complete a bullish breakout and retest on the monthly chart. According to the price chart shared by the analyst, the strong bullish momentum could propel ETH to $7,000 by the end of 2024 and pave the way for it to cross $10,000 and $15,000 in the years that follow.
The sustained bullish sentiment among Ethereum traders is reflected in the large outflows from exchanges. With investors moving ETH to private wallets, the cryptocurrency's price is poised to continue its upward trajectory, with the next targets being above $4,000 and historical highs. The long-term outlook is also positive, with analysts projecting that ETH could reach $7,000 or higher in the coming years.
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