Ethereum surged to a 12-day high of $2,832 before retracing to $2,720, marking a 2% daily gain. This rise comes as the broader crypto market declined by 2.4%. Data from blockchain analytics firm Santiment reveals that Ethereum’s exchange supply has dropped to its lowest level since its inception, signaling strong accumulation by investors.
Accumulation Trend Strengthens ETH’s Long-Term Outlook
One of the key bullish indicators for Ethereum is the significant decline in its exchange supply. Santiment reports that only 6.38% of ETH’s total supply remains on centralized exchanges, suggesting that investors are holding their assets rather than selling.
Additionally, ETH withdrawals from derivatives exchanges have reached their highest level since August 2023, highlighting increasing investor confidence. While these factors indicate long-term bullish sentiment, analysts caution that they do not necessarily signal an immediate breakout.
Ethereum’s Struggle Against Bitcoin Persists
Despite its recent gains, Ethereum continues to underperform against Bitcoin. The ETH/BTC ratio saw a 7% uptick on February 17, reaching 0.029, yet it remains near its lowest level since December 2020.
Ethereum has lagged behind Bitcoin since mid-2022, reflecting shifting investor preference toward BTC. Analysts suggest that ETH needs stronger catalysts to regain momentum, as its valuation against Bitcoin remains under pressure.
Market Sentiment Divided as Resistance Holds
The market remains split on Ethereum’s latest rally. Some traders see the price increase as a sign of recovery, while others remain skeptical. Crypto analyst Lark Davis dismissed the move, noting that ETH often experiences small gains before retracing.
Analysts at Time To Trade pointed out that Ethereum has yet to break the crucial $2,710 resistance level. If ETH fails to hold above this level, selling pressure could push the price down to $2,635, with a potential drop toward $2,500.
Meanwhile, short sellers have increased their bearish bets on Ethereum. Futures contracts on the Chicago Mercantile Exchange (CME) reached a record high of 11,341 this month, up 40% in a week and 500% since November. This suggests that many traders remain cautious about Ethereum’s short-term prospects.
