U.S. investors choose Ethereum despite market turmoil: Bullish for ETH?

• Insights revealed that U.S. investors are actively acquiring ETH despite its recent decline.
• While mixed signals from various metrics cast uncertainty on the potential for a rally, technical patterns point to an upswing.

The broader cryptocurrency market experienced a significant shakeout in the last 24 hours, with Ethereum [ETH] declining by 8.41%, eroding its weekly performance to a loss of 4.76%.

However, further analysis suggested that this downturn may be short-lived, as U.S. investors seemed ready to drive ETH prices higher.

U.S. investors are behind ETH despite market volatility

Recent data from Crypto Quant’s Coinbase Premium Index for Ethereum, which gauges the price differential between Ethereum on U.S.-based Coinbase Pro and global exchange Binance [BNB], signals heightened interest from U.S. crypto investors despite a recent market downturn.

A positive reading on this index indicated that Ethereum commanded a higher price on Coinbase Pro compared to Binance, which suggested a strong buying interest among U.S. investors.

Source: Crypto Quant

At press time, the index stood at a positive 0.03, reflecting continued investor confidence even amid broader market turmoil. If such buying activity persists, it is likely that Ethereum’s price will ascend accordingly.

Further investigation by AMBCrypto revealed that while the potential for a rally is backed by U.S. investors, sentiment within other sectors remains divided.

Mixed sentiment among retailers for ETH’s prospects

While some retailers remain enthusiastic about Ethereum, indicators provide mixed signals about its future price trajectory. 

The growing number of active and new addresses points to bullish sentiment.

Specifically, the past few days have seen an 18.34% increase in new addresses and an 11.61% rise in active addresses, suggesting a high engagement with Ethereum.

Source: IntoTheBlock

As of the last 24 hours, the number of new addresses reached 114.92K, and active addresses stood at 507.15K. This high activity level indicates that bullish sentiment in the market was steadily increasing.

However, the negative Funding Rate for Ethereum presented a contrasting view. It indicated that a majority of retail traders anticipated a price decline and were prepared to pay a premium to maintain their short positions.

If this bearish outlook persists, it could hinder Ethereum’s potential to rally, despite significant interest from U.S. investors and positive growth in address statistics.

Support level will determine ETH’s next move

ETH has recently broken down from a consolidation phase, a period typically marked by significant accumulation by whales in anticipation of a rally. This downturn can be attributed to a stop hunt.

A stop hunt involves large institutions deliberately manipulating the price of an asset to activate stop-loss orders, causing swift price movements.

This strategy allows them to purchase or sell large quantities at favorable prices before the market regains stability.

Source: Trading View

In this instance, it enabled institutional traders to accumulate more ETH at lower prices. These levels also coincide with a demand zone, potentially catalyzing an upward rally.

Read Ethereum’s [ETH] Price Prediction 2024–2025

However, the sustainability of this rally hinges on whether the support level at $2,552.99 doesn’t turn into a resistance, which would restrict upward price movement. 

Additionally, a breakthrough above the $2,723.83 resistance level would further confirm the bullish presence in the market.