Ethereum is facing a significant supply shock as over 1 million ETH exited exchanges within 30 days, coinciding with a 50% price surge.
Supply Shock of Ethereum
With over 1 million ETH leaving exchanges, sell-side liquidity has sharply decreased. This has led to a reduction in the amount of ETH held on exchanges to just over 17 million coins, representing a 5.5% drop. This outflow marks the most significant change since the 2021 bull cycle.
Exchange Outflow Trends
The trends surrounding ETH outflows from exchanges indicate strong bullish signals. Since early March, Ethereum's supply has been gradually decreasing, with a significant drop occurring in mid-April. This reduction lowered the potential selling pressure, contributing to upward price momentum.
Short-term and Long-term Forecasts
Short-term forecasts reveal a mixed outlook. ETH has been oscillating between $2,500 support and $2,625 resistance. Despite the bullish signals such as MACD crossover, the RSI indicates overbought conditions and active profit-taking among traders.
If the supply shock continues, it could lead to rapid price discovery. Otherwise, market participants may experience continued fluctuations as traders and whales reposition.
