Ethereum (ETH) Price: Exchange Withdrawals Surge Even as Market Turns Red

TLDR:

ETH has dropped 11.5% in five days from $2,738 to $2,426 Technical charts show bearish trend line with resistance at $2,540 May 16 recorded largest ETH exchange withdrawal since early April Coinbase Premium Index remains positive despite price correction Trading volume patterns show similarities to December 2024’s market behavior

---

Ethereum has entered a correction phase, retreating from recent attempts to breach higher resistance levels. The price of ETH has fallen from $2,738 on Tuesday to $2,426 at press time, marking an 11.5% decrease over just five days.

This downward movement comes after ETH failed to clear the important $2,520 resistance level. Technical charts now show the formation of a bearish trend line with resistance established at $2,540.

The correction has pushed ETH below both the $2,500 psychological level and the 100-hourly Simple Moving Average, which typically serves as an important technical indicator for traders.

ETH is currently maintaining position above the 61.8% Fibonacci retracement level calculated from the recent swing low of $2,308 to the high of $2,509. This suggests that while bearish pressure exists, there remains some underlying support.

Bears managed to push the price below the 50% Fibonacci retracement level during the dip, but buyer activity near the $2,400 zone prevented further decline.

Ethereum (ETH) Price

On-Chain Data Reveals Mixed Signals

On-chain metrics present an interesting contrast to the price action. Exchange data shows negative netflows, suggesting accumulation activity is taking place despite the price drop.

May 16 marked a key date for ETH movement, recording the largest withdrawal of ETH from exchanges since early April. Large withdrawals from exchanges are often interpreted as bullish signals, as they typically indicate investors moving assets to longer-term storage options.

The Coinbase Premium Index has maintained positive values throughout the past month. This metric tracks the price difference between Coinbase (USD pair) and Binance (USDT pair), with positive values indicating increased interest from U.S.-based market participants.

This positive premium has been consistent since ETH began its rally from the $1,600 level, suggesting continued interest from American investors even during the current correction.

Selling Pressure Intensifies

Despite these potentially positive signals, other metrics point to increasing selling pressure. The 7-day moving average of the taker buy-sell ratio has been declining rapidly over the last week.

This metric reveals that taker sell orders are substantially outweighing buy orders in the market. Since these represent market orders, the imbalance points to heightened selling pressure that may be hampering upward momentum.

Some holders appear eager to lock in profits, which could explain why the rally stalled upon reaching the $2,800 level. Market analysts note that this behavior mirrors patterns observed in December 2024.

Historical Patterns Emerge

The spot volume bubble map for ETH shows that trading volume was relatively low during April’s price bottom. More concerning for bulls is that trading volume has been consistently decreasing over recent days.

In December 2024, a sharp uptick in trading volume was classified as “overheating” and was promptly followed by a significant price drop. Current volume patterns may be showing early warning signs of a similar scenario.

The cooling trading volume as ETH approaches the $2,600-$2,800 resistance zone could indicate buyer hesitation. However, it might also suggest that profit-taking hasn’t reached overwhelming levels, supporting the theory that this is more likely a “market reset” than the beginning of a prolonged bearish trend.

The post Ethereum (ETH) Price: Exchange Withdrawals Surge Even as Market Turns Red appeared first on CoinCentral.