Ethereum fails to react as exchange outflow hits highest since August

• Ethereum’s daily exchange outflow reached its highest level since August on 4 October.
• ETH’s accumulation has continued to dawdle. 

On 4 October, over 110,000 Ethereum [ETH] coins, worth around $177.65 million, were withdrawn from known crypto exchange wallets, marking the highest daily exchange outflow since August.

#Ethereum | Roughly 110,000 $ETH were withdrawn from known #crypto exchange wallets in the past 24 hours, worth around $177.65 million, according to onchain data from @santimentfeed. pic.twitter.com/3CGVgOQUbM

— Ali (@ali_charts) October 5, 2023

When an asset’s exchange outflow surges in this manner, it suggests that coin holders are moving their assets off exchanges and into cold storage or other non-custodial wallets, which could signify bullish sentiment.

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ETH fails to react

A surge in exchange outflows is typically followed by a rally in an asset’s price, which means a reduction in sell-offs. However, this has yet to manifest in ETH, as the price remains trapped within a narrow range.

At press time, the leading altcoin exchanged hands at $1,620. Following Bitcoin’s [BTC] brief surge above $28,000 during the intraday trading session on 5 October, ETH’s price touched $1648, after which it shed all its gains, data from CoinMarketCap showed. 

On the daily chart, coin accumulation amongst spot traders has lost momentum. As of this writing, the coin’s Relative Strength Index (RSI) was positioned in a downtrend beneath its 50-neutral line. 

Likewise, the coin’s Chaikin Money Flow (CMF) was below the zero line at -0.11. A negative CMF value indicates that more money is flowing out of an asset than into it. 

A negative CMF value coupled with price consolidation or decline is taken as a bearish signal, suggesting that investors are selling the asset and reducing their exposure.

An assessment of the coin’s Directional Movement Index (DMI) revealed that ETH’s sellers regained market control after the coin’s price fell from its $1648 peak on 5 October. At press time, the negative directional indicator (red) at 20.63 was positioned above the positive directional indicator (green) at 20.23.

This crossover showed that the current price trend in the ETH market was a downtrend and that downward price movements outpaced upward price movements. 

Source: ETH/USDT on TradingView

Realistic or not, here’s ETH’s market cap in BTC terms

Futures traders tread a different path

Despite the recent price action and the significant bearish sentiments in the ETH market, futures traders have remained steadfast.

The month so far has seen an uptick in ETH’s Open Interest. According to data from Coinglass, the coin’s Open Interest has increased by 3% since 3 October. 

When ETH open interest increases, it means that the total number of ETH futures contracts that have not been settled has increased.

It is a bullish signal as it suggests that more investors are opening new positions in ETH. And that there is increasing demand for the asset.

Source: Coinglass

It remains notable that the coin’s funding rates across exchanges have remained positive despite ETH’s headwinds since April. 

Source: Coinglass