Ethereum’s Supply on Exchanges Surges as Price Drops: What’s Next for ETH?

As Ethereum’s supply on exchanges increased in the last few days, the cryptocurrency saw a significant outflow from exchanges while its price action turned bearish. Despite a recent rally that saw ETH surpass the $3k mark, the market sentiment shifted in the last 24 hours, leading to a drop of over 2% in ETH’s price.

Notably, investors had been stockpiling ETH in anticipation of a further price increase, with over 260,000 ETH, equivalent to more than $781 million, being withdrawn from exchanges in the past week. Even Justin Sun was seen accumulating ETH, withdrawing millions of dollars worth of the cryptocurrency from Binance.

However, the recent price drop has led to an increase in selling pressure, as reflected in ETH’s net deposit on exchanges and supply-on-exchange graph. Despite this, whale accumulation of ETH continued to rise, indicating a mixed sentiment among investors.

Looking ahead, ETH’s derivatives metrics and technical indicators suggest a potential further price drop, with the Funding Rate increasing and indicators like the Chaikin Money Flow and Money Flow Index showing bearish signals.

With the cryptocurrency market experiencing volatility, it remains to be seen how Ethereum will navigate these challenges and whether it can regain its bullish momentum in the near future.