Ethereum (ETH) has successfully reclaimed the critical $2,500 level, signaling a potential shift in market sentiment as large-scale investors ramp up accumulation. The asset is currently trading around $2,580, reflecting a 2% gain during early Asian trading hours, driven by heightened whale activity and declining exchange reserves.
Ethereum Exchange Supply Hits Multi-Month Low
Ethereum’s supply on exchanges has plunged to its lowest point since August 2024, dropping to approximately 18.73 million ETH. This sustained outflow from exchanges suggests strong spot market buying pressure and a growing preference for long-term holding among investors.
Since the downtrend began on April 24, over 1 million ETH have been moved from trading platforms to private wallets. This reduction in readily available supply has historically supported price stability and upward momentum, creating a favorable environment for continued recovery.
Whale Accumulation Intensifies
Large holders, often referred to as whales, have significantly increased their Ethereum purchases over the past nine days. Entities holding between 10,000 and 100,000 ETH have expanded their combined balance by more than 670,000 ETH, underscoring strong institutional and high-net-worth investor confidence.
In contrast, smaller holders have been distributing their holdings, reducing their total balance by approximately 110,000 ETH during the same period. This divergence highlights a broader market trend where experienced investors are accumulating during consolidation phases, while retail participants exhibit more cautious behavior.
Technical and Sentiment Analysis
Despite consistent buying pressure, Ethereum has continued to trade within a narrow range near the $2,500 mark. Futures market data reveals heightened trading activity whenever the price approaches or moves away from this level, confirming its importance as a short-term psychological and technical barrier.
Search interest for Ethereum has also seen a moderate increase, rising from a score of 45 on May 17 to near 60, though it remains below the peak of 100 observed during the rally in early May. This suggests that while retail curiosity is growing, it is not yet driving price action—leasing room for more sustainable, less speculative growth.
Market Liquidation and Momentum Indicators
Recent market activity resulted in $106.52 million worth of futures liquidations over a 24-hour period. Long positions accounted for $56.20 million of these liquidations, while short positions comprised $50.32 million, reflecting balanced yet heightened volatility.
ETH briefly surpassed $2,600 on Wednesday but faced rejection near the 200-day Simple Moving Average (SMA). As buying pressure continues, bulls are aiming to sustain the price above $2,500 to build a foundation for further gains.
Technical indicators present a mixed outlook. The Relative Strength Index (RSI) is hovering near overbought territory, suggesting some near-term exhaustion among buyers. Meanwhile, the Moving Average Convergence Divergence (MACD) is testing its signal line, with the histogram nearing a negative flip. A bearish crossover could signal increasing downward momentum.
Key Levels to Watch
For Ethereum to establish a clear directional bias, a decisive breakout above or below key thresholds is essential:
- A sustained move above the $2,850 resistance could open the path toward $3,250.
- A breakdown below the $2,100–$2,260 support zone may lead to a test of the $1,688 level.
Traders and investors are advised to monitor volume closely, as a high-volume breakout will likely confirm the next major trend. Until then, ETH is expected to continue consolidating within its current range.
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Frequently Asked Questions
What does a decrease in exchange supply mean for Ethereum’s price?
A reduction in exchange supply typically indicates that investors are moving ETH into cold storage or private wallets for long-term holding. This decreases selling pressure and can create upward price momentum due to reduced liquid supply.
How do whale purchases influence the market?
Large accumulations by whales often signal confidence in the asset’s future value. Their buying activity can reduce market supply and inspire retail confidence, contributing to bullish market conditions.
What is the significance of the $2,500 level for Ethereum?
The $2,500 price level serves as a major psychological barrier and technical support/resistance zone. Breaking above it with conviction often leads to increased buying interest, while losing it could trigger further declines.
Which indicators are useful for tracking Ethereum’s momentum?
Traders often use the RSI to gauge overbought or oversold conditions, the MACD for trend changes, and volume profiles to confirm breakouts. Exchange flow data and large holder activity also provide insight into market sentiment.
Is now a good time to invest in Ethereum?
Market conditions should always be evaluated in the context of your financial goals and risk tolerance. While current whale activity and supply reductions are positive signs, cryptocurrency investments remain volatile. Conduct thorough research and consider professional advice.
What catalysts could drive Ethereum’s price higher?
Key catalysts include broader cryptocurrency market bullishness, regulatory clarity, increased adoption of Ethereum-based applications, and positive developments in network upgrades such as scalability improvements.
This article contains forward-looking statements based on current market data. Cryptocurrency investments involve significant risk, including potential loss of principal. Readers should conduct independent research and consult financial advisors before making investment decisions. Neither the author nor the publisher guarantees the accuracy or timeliness of the information presented. Market conditions are subject to change rapidly.