Ethereum Price Primed for Rebound as Exchange Reserves Drop
Ethereum price has retreated about 22% from its year-to-date high but remains above the 200-day moving average near $3,860. On the daily chart, ETH has formed a bullish flag pattern within a descending channel. A break above the channel could drive a rebound toward $4,963 and test resistance at $5,000. Key support sits at $3,570. Exchange reserves of Ether have dropped from 27 million to 15.9 million ETH, its lowest since 2022, reducing sell pressure. Ethereum ETFs have attracted over $14 billion since July and now hold $26 billion in assets. Staking demand is strong, with $140 billion staked (30% ratio) and yields around 3%. Stablecoin supply on Ethereum rose 1.35% to $167 billion, and adjusted transaction volume reached $1 trillion in 30 days. Major institutional players like Tom Lee’s BitMine (holding $6.6 billion ETH) and SharpLink (797,000 ETH) are increasing positions. A positive futures funding rate signals bullish trader sentiment. Traders should monitor the flag’s lower boundary; a breach could trigger further declines toward $3,000.
Bullish
Ethereum price shows converging bullish signals across technical and fundamental indicators. The bullish flag pattern and position above the 200-day moving average support a potential rebound toward $5,000. On-chain metrics—exchange reserves at multi-year lows and ETF inflows exceeding $14 billion—indicate strong accumulation and reduced sell pressure. Robust staking ratios, stablecoin supply growth, and high transaction volume reflect healthy network demand. Institutional inflows from BitMine, SharpLink and others further bolster confidence. While a drop below the flag’s lower boundary near $3,570 could trigger short-term pullbacks, the overall alignment of bullish momentum suggests a favorable outlook for Ethereum price.