In recent days, the cryptocurrency market has experienced a surge in activity, with Bitcoin making multiple attempts to break the $35,000 level. Taking advantage of Bitcoin’s bullish momentum, Ethereum traders are pushing the price of ETH beyond $1,900. The continued negative Netflow, indicating a higher amount of Ethereum being bought than sold, has led analysts to become increasingly optimistic about ETH’s potential to surpass the $1,900 mark. This trend has created a bullish sentiment among investors, boosting their confidence to purchase more ETH in anticipation of future gains.
Despite facing network challenges, Ethereum remains confident and resilient. Other altcoins like Solana (SOL), XRP, and Cardano (ADA) have outperformed Ethereum in the past month, with returns of 75%, 37%, and 34% respectively. This performance gap suggests that the issues affecting ETH extend beyond network hurdles or a decline in the DeFi and NFT sectors.
One significant problem for the Ethereum network is the rising transaction costs, particularly for operations involving smart contracts. The average transaction fee in the past week reached $4.90, discouraging the use of decentralized applications (DApps).
Additionally, the amount of Ether deposited on the Ethereum network has reached its lowest point since August 2020. However, despite these setbacks, Ethereum continues to move forward, as indicated by on-chain metrics.
Data from IntoTheBlock reveals that Ethereum’s Netflow has remained negative for the past four days, signaling a positive outlook as more Ethereum is leaving exchanges than entering. This trend suggests reduced selling pressure among investors as exchange reserves decline, with the current Netflow at -27,700 ETH.
Furthermore, Ethereum’s Open Interest (OI) has reached a three-month high, with traders actively initiating futures contracts, driving the value up to $6.6 billion.
Looking ahead, Ether has made attempts to surpass the immediate resistance level at $1,900, but faced bearish resistance and experienced significant sell-offs at higher prices. Currently, ETH is trading at $1,896, decreasing by 0.3% in the last 24 hours.
The next move for bears would be to push the price down towards the strong support level at $1,860. This level is crucial to watch, as buyers might strongly defend it. If the price rebounds from this level, ETH could break out above the upper trend line and consolidate around $1,983-$2,024.
Conversely, if bulls fail to defend the $1,860 level, the ETH price might sharply decline. In that case, it could hover around $1,747 for a while. If sellers continue to dominate, the ETH price might witness another decline, stabilizing around $1,670.