Ethereum ETFs extend $20 million outflow streak, ETH poised to continue consolidation

• Ethereum ETFs record outflows of $20.3 million, extending the outflow period to three days.
• More than 80% of ETH supply is in profit, despite the fact that the market has yet to recover from the early August crash.
• Ethereum could continue to consolidate until its open interest sees a sizeable increase.

Ethereum (ETH) fell nearly 1% on Tuesday as its weak open interest indicates that prices are likely to remain range-bound in the coming days. The choppy price action coincides with ETH ETH seeing its third consecutive day of negative flows, with net outflows of $20.3 million on Monday.

Daily Market Reasons: Ethereum ETF, Big Profit Offer

Ethereum ETFs posted $13.5 million in net outflows on Monday, extending their streak to three consecutive days of outflows. Grayscale ETHE saw flows of $20.3 million, Bitwise ETHW had inflows of $1.9 million, while other issuers had zero flows.

Meanwhile, despite the market correction since early August, IntoTheBlock data shows that a fair share of Ethereum’s supply is held in profit.

Global In/Out of the Money tracks the total number of coins or addresses making profits or losses based on current prices. A coin/address is in the money if its average cost is below current prices and out of the money otherwise.

ETH’s Global In/Out of the Money reveals that more than 80% of its supply is held in profit, with Ethereum price hovering around the $2,570 mark. A large amount of take-profit after a price decline often signals periods of consolidation in an asset’s price.

Global In/Out of the Money of ETH

The ratio of market value to realized value (MVRV) also indicates the average profitability of all addresses that purchased ETH during certain time frames. Values ​​above zero indicate profitability and vice versa if they are below zero.

The 30d, 365d, 2 and 3 year MVRV ratio of ETH are -8.96%, -5.41, 12.73% and 6.67% respectively. This indicates long-term holders (LTH) are on average profiting despite the recent market decline, while short-term holders are on average losing.

ETH Technical Analysis: Ethereum May Continue to Consolidate

Ethereum is trading around $2,600 on Tuesday, down about 1% on the day. Over the past 24 hours, ETH has seen liquidations of $23.8 million, with long and short liquidations accounting for $15.13 million and $8.68 million, respectively.

Ethereum’s open interest is $10.69 billion, a loss of more than $6 billion since hitting a record high of $17.09 billion on May 28. Open interest is the total number of outstanding long and short positions in the market. Increased OI means increased investor confidence and risk appetite and vice versa when OI decreases.

ETH Open Interest

The price of ETH rose to $3,896 when its OI hit a record high on May 28. However, the recent market correction brought ETH OI back to the levels it held for almost a month from mid-April to mid-May. During this one-month period, ETH price consolidated in the range of $2,800 to $3,200. As a result, ETH will likely consolidate near current levels until its open interest sees a reasonable increase.

A move above the $2,800 price level could see ETH reclaim a major support level and help shift market sentiment to near-term optimism.

ETH/USDT 4 Hour Chart

The move is highlighted in the Awesome Oscillator (AO), which climbed above the 0 level at 24, posting a high when ETH dropped. This often signals a momentum reversal, meaning ETH could see a brief rally.

However, the Relative Strength Index (RSI) is trending down and has moved below its moving average, signaling a temporary bearish outlook. A daily close of the candlestick below the $2,111 support level could trigger a massive correction for ETH.

In the short term, ETH could rise to $2,695 to liquidate $40.84M worth of positions.