There has been a significant rise in large transactions on the Ethereum network, with weekly transaction volumes spiking by over 300% to $17.15 billion before stabilizing at $7 billion.
Notably, the activity of whales, who are conducting transactions exceeding $100,000, has surged, aligning with Ethereum’s surge to $4,000.
With exchange netflows indicating reduced selling pressure, the market is now focused on overcoming key psychological resistance levels, supported by bullish momentum and strong support levels.
Examining Ethereum’s Surge in Large Transactions
Ethereum has recently experienced a notable increase in large transactions, sparking interest in the implications of these activities as its price nears significant levels.
Analysis of the transaction data on IntoTheBlock reveals that weekly transaction volumes surged over 300% to $17.15 billion on December 6th before decreasing to $7 billion presently.
Moreover, insights from the large transaction data on Santiment indicate a sharp uptick in whale transactions surpassing $100,000, signifying heightened institutional or high-net-worth involvement.
The increased whale activity has coincided with Ethereum’s climb to $4,000, potentially indicating profit-taking strategies or portfolio adjustments among significant holders.
Notably, the whale transaction count demonstrates periodic peaks, indicating strategic moves during times of price volatility.
Relationship Between Exchange Netflow and Price Movements
Observing the exchange netflow behavior, there have been alternating patterns of inflows and outflows, with recent notable outflows pointing towards reduced selling pressure. A negative netflow of over 17,000 was recorded.
While such outflows typically signal a bullish sentiment as assets are moved into cold storage, Ethereum has faced resistance around $4,000, which coincides with profit-taking patterns and psychological barriers in the market.
Price Trends and Technical Analysis
Ethereum’s price chart illustrates a consistent upward trend since early November, with strong support from the 50-day moving average throughout this period.
The recent surge to $4,000 was accompanied by higher trading volume, indicating significant market participation during this move.
Despite the Relative Strength Index (RSI) nearing 69.62, approaching overbought conditions that often precede short-term corrections, the Moving Average Convergence Divergence (MACD) remains in a bullish phase, suggesting sustained upward momentum.
While the histogram indicates a decrease in bullish momentum, there is no clear indication of a reversal at this point. Essential support levels are situated at $3,800 and $3,500, coinciding with the 50-day moving average and former resistance levels now acting as support.
The surge in large transactions emphasizes the heightened interest and activity among whales, likely driven by Ethereum’s improved fundamentals and positive market sentiments.
The overall price action suggests Ethereum is in a healthy uptrend, with robust support levels in place and momentum indicators favoring further upside potential.
However, the $4,000 resistance level requires close monitoring, as a temporary consolidation phase may occur before potential further upward movements.