Ethereum [ETH] has maintained its position as the second-largest cryptocurrency, with market sentiment transitioning from a bearish to a bullish outlook as we approach the end of 2024.
The price movement of Ethereum is resembling the pattern observed in 2019 on the ETH/USD pair, where an ascending wedge formation occurred.
The higher lows within the current wedge are approximately ten times larger than those noted in 2019.
Similarly to 2019, Ethereum’s price descended below the ascending wedge before the initial Federal Reserve rate cut, mirroring the current situation in 2024.
Following the rate cut in 2019, both ETH/USD and ETH/BTC hit bottom, forming a robust confluence point.
It is anticipated that the current pattern will mimic this success, with the price likely to breach below the wedge, attracting liquidity before reversing upwards towards the end of Q4 2024 or early Q1 2025.
If, however, the price remains below the ascending wedge for an extended period, further assessment may be necessary to adjust strategies and mitigate potential losses.
Persistent Accumulation by Whales
Whales continue to play a crucial role in bolstering the anticipated upward movement. Major holders of Ethereum have been consistently amassing more ETH since 2019, with this trend intensifying following the Shanghai upgrade in early 2023.
As of the latest data, whales now control over 43% of Ethereum’s circulating supply, nearing the 48% held by retail investors.
This ongoing accumulation suggests that these significant players anticipate a future increase in Ethereum’s price.
ETH Exchange Netflows Overview
An analysis of Ethereum’s exchange netflows indicates that the negative netflow on derivative exchanges has exceeded 40,000 ETH.
This trend implies a notable withdrawal of ETH from these exchanges, with funds being shifted to cold wallets, signaling a decrease in selling pressure.
Traders could be gearing up for long-term growth, indicating that the current decline in Ethereum’s price is a temporary correction, potentially paving the way for a substantial upward thrust.
Update on Ethereum ETFs
While there have been some negative net outflows from Ethereum ETFs, there are positive developments as well. ETH ETFs, such as Fidelity’s, witnessed inflows over the past 24 hours, with Grayscale’s ETHE being the sole ETF to experience an outflow.
Despite these fluctuations, the overall optimistic sentiment surrounding ETFs is expected to bolster Ethereum’s future price trajectory.