ETH’s latest milestone could mean nothing if these holders stay on edge

• Ethereum’s unique address activity triggers excitement about ETH’s bullish prospects.
• A deeper examination revealed a lack of confidence and conviction in ETH bulls.

The crypto market is finally showing some love to the bulls after a long bearish streak. Amid the returning hype, Ethereum’s unique wallets bounced to the second-highest level since the network was launched.

How many are 1,10,100 ETHs worth today

A recent Santiment analysis looked into the recent spike in the number of unique wallets on the Ethereum network on Wednesday (13 September). This was for both senders and receivers and the addresses reportedly registered the second-highest surge in Ethereum’s entire existence.

?? The #Ethereum network just saw 1,089,893 unique wallets acting as a sender or receiver of $ETH on Wednesday, the 2nd highest amount in the asset’s 8+ year history. This historic anomaly could be the capitulation signal needed for prices to rebound. https://t.co/JF0g8vvBWs pic.twitter.com/1dRnPCjxcA

— Santiment (@santimentfeed) September 14, 2023

A bull trap in the making?

The same Santiment analysis suggested that the spike could be a reflection of bullish activity backing a pivot. An assessment of liquidity flow may offer some clarity. The return of the bulls would likely be characterized by heavy exchange outflows relative to inflows indicating that liquidity was flowing into private wallets.

Ethereum exchange flow data revealed that inflows have been dominating and were higher than exchange outflows. This could indicate that the ongoing ETH liquidity flow wasn’t consistent with a strong bullish move.

Source: CryptoQuant

Despite the above findings, ETH’s price action pulled off a 5% upside in the last 3 days. This is the first time that the cryptocurrency has achieved a 3-day consecutive rally since June. ETH exchanged hands at $1631 at press time.

ETH’s spike in unique addresses could be a good indicator of the return of volatility. However, we still haven’t identified what the key market movers have been up to. The supply of ETH held by top addresses reached a new weekly high in the last 24 hours. This could be taken as a confirmation that whales were still buying at the current levels.

Source: Santiment

Are ETH whales in opposition?

Despite the whale accumulation, ETH’s weighted sentiment indicated that the current rally was backed by low confidence. Some whales were still contributing to selling pressure. Thus, holding down ETH from more potential gains.

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According to the supply distribution metric, addresses holding between 10,000 and 100,000 ETH fell by a substantial margin. The same applied to addresses holding at least 1 million ETH. The rest of the whale addresses have been accumulating.

Source: Santiment

The supply distribution indicated a lack of consistency or uniformity among the whales. Another sign that demonstrates why the current rally might be limited.

As such, the recent spike in unique addresses may not necessarily be a sign that the ongoing rally is the big one. The contrasting on-chain findings offer an opinion that ETH might not be ready to give up its recent bearish tendencies