Ethereum [ETH] has rallied 11.7% over the past week, but it is possible that short-term holders were preparing to exit the market.
The exchange net position change had been negative since mid-May, but posted a positive bar on its histogram on Sunday, July 5.
Negative net position change implies a net outflow of assets from exchange-affiliated addresses. A shift toward positive indicates that net inflows were greater in volume.
This inflow can be interpreted as readiness for selling from holders, though it need not provide an immediate bearish price reaction.
Recently, AMBCrypto pointed to a discrepancy between trader and developer activity. Alongside the monthly TD Sequential buy signal, bulls had hopes of a move toward $2,000.
That optimism faded as Bitcoin [BTC] faced rejection from the $63k area, unable to assail the $64k local supply zone in earnest. This rejection has caused an Ethereum price slide below $1,800.
Ethereum bullish hopes misplaced?
Crypto analyst Darkfost drew attention to the severe decline in Open Interest. From a record high of $33.9 billion in October 2025, to just $11.2 billion, the corrective leg of the cycle has shaken market conviction.
Examining the liquidation volume bubble map showed a high volume of long liquidations towards the end of June, rivaling the size of the October long liquidations.
The Coinbase Premium Index has been negative since late April, another sign of bearish market sentiment. U.S.-based investors have not been taken in by the recent price bounce toward $1.8k.
The large volume of short liquidations showed that many traders had been positioned for further downside before the recent rally forced them to exit. A small corrective bounce amid a wider downtrend has caused $314.5 million in short liquidations so far in July.
The Ethereum holder accumulation ratio tracks the proportion of active users who are increasing their holdings, compared to those who are decreasing. Lower ratios indicate bearish momentum, and tend to mark periods of distribution and profit-taking.
The drop in the holder accumulation ratio since May suggested the current distribution has not ended.
Final Summary
- Ethereum was up by 11% over the past week of trading, triggering over $300 million in liquidations within a week.
- Other onchain metrics showed that the current distribution trends were likely to cause a deeper ETH price slide.