Ethereum’s Future Uncertain as Exchange Deposits Reach 8-Month High

Ethereum (ETH), the second-largest cryptocurrency by market value, extended its sluggish two-week trading period into the weekend.

The asset’s price has fluctuated between $1,825 and $1,930 since its initial drop after the Shanghai-Shapella upgrade. Many factors have contributed to this downturn, but one of the most important is the flood of foreign currency, which might fuel short selling.

Santiment, a cryptocurrency analytics firm, forecasted in a tweet that there had been a recent surge of coins being sent to exchange addresses, causing Ethereum to experience volatility once again:

The company reported on Friday that the cryptocurrency’s active exchange deposits had reached a new high, exceeding the previous peak by eight months.

The company recently tweeted when it disclosed sending 273,781 Ethereum tokens from its wallet to the cryptocurrency exchange Binance. This was the largest such transfer in the past five years.

The usual purpose behind a user depositing cryptocurrency onto an exchange is to sell or trade that cryptocurrency. The recent increase in Ethereum exchange deposits should concern to investors and traders because selling can be an indicator of probable downward price movement.

Traders holding 1,000 to 10,000 ETH have dumped approximately 110,000 ETH in the past two weeks, according to a tweet by cryptocurrency expert “Ali-charts.”

Crypto Patel concluded in his analysis that the current state of the Ether market is rangebound, with solid support at $1800 and resistance at $1930.  The $1800 support would hold, preventing a decline to $1400-$1500, or the $1930 resistance would be reached. A breakout above that resistance level might trigger a rally to $2100-$2500.