Ethereum continues to face challenges.

It has been observed that the number of transactions on the Ethereum network has increased in recent days. On-chain data shows that there has been a significant transfer of Ethereum to Binance, totaling $505 million in recent days. This may indicate that there could be a sell-off of Ethereum in the near future.

When exchanges experience an increase in trading volume, it typically means that investors are depositing some of their coins to exchange at that time. This trend is usually negative for the asset price as the primary reason why investors transfer coins to an exchange is usually to sell the asset.

However, what is interesting is that the recent increase in deposits to Binance mostly came from a single transfer, according to transaction tracking service Whale Alert. It is unclear whether this deposit was made with the intention of selling the coins or to use other services offered by the platform. Nonetheless, if the goal was to sell the coins, the large influx of Ethereum to Binance could be bearish news for the asset price.

In addition to the news of the whale depositing coins to Binance, there have been significant institutional investors increasing their investment in Ethereum after the completion of the Shanghai Hard Fork (Shapella) on April 12, 2023.

Information from the Digital Asset Fund Flows Weekly report by CoinShares reveals that the Shanghai Hard Fork upgrade has led to an increase in investment of approximately THB 580 billion ($17 million). This indicates that investors are confident in the operation of the Shanghai Hard Fork.

Additionally, the Shanghai Hard Fork upgrade has enabled the withdrawal of ETH from the Beacon Chain, which means that a large amount of ETH could be withdrawn and sold. This could lead to significant profit-taking with regards to the current price of ETH, which is available on Shapella.

Nicole DeCicco, CEO of CryptoConsultz, believes that there may be significant short-term volatility in the price of ETH as there is no disputing the fact that the upgrade will release an enormous amount of ETH into the market. "These things will make long-term investors need to plan how to deal with ETH but it wouldn't be surprising to see short-term price fluctuations for investors."

Furthermore, the rate of cryptocurrency token sales is estimated to be around THB 1.023 trillion ($30 million) in the past week, which is a large-scale token dump for the sixth consecutive week.

Technical analysis data (5H)

Resistance: 1870.10, 1877.42, 1884.35

Support: 1855.85, 1848.92, 1841.60

Source: Investing.com

 

Pivot Points May 3, 2023 04:52 PM GMT+7