Ethereum exchange reserve rises by 163,000 ETH amid mixed signals from on-chain indicators

• The Ethereum exchange reserve has increased by 163,000 ETH in the last five days.
• Ethereum has added over 4 million new holders in the last three months.
• Ethereum could bounce near the $2,400 support after moving average resistance.

Ethereum (ETH) fell more than 2% on Tuesday on a sign of selling pressure due to an increase in foreign exchange reserves. However, other on-chain metrics indicate mixed investor sentiment amid ETH price consolidation.

Daily Market Reasons: Increase in ETH Currency Reserve, Uptrend of New Holders

Since August 29, the exchange reserve of Ethereum has gone from a downtrend to an uptrend. Exchange reserve is the total amount of a cryptocurrency held on an exchange. An increase in an asset’s exchange rate indicates greater selling pressure and vice versa for a decrease.

According to CryptoQuant data, Ethereum’s exchange reserve has increased by about 163,000 ETH, worth about $407.5 million, in the past five days. As a result, ETH may see short-term selling pressure until its exchange reserve begins to decline again.

ETH exchange reserve

Meanwhile, despite Ethereum’s price gap, its total number of holders has been on an upward trend, adding more than 4 million new non-empty wallets in the past three months, according to Santiment data. This brings the total number of ETH holders to nearly 127 million, meaning new market entrants could be betting on a long-term ETH price rise. In comparison, total BTC holders fell by 50,000 during the same period.

ETH vs BTC Total Holders

While the number of Ethereum holders is increasing, whale activity within the network has fallen considerably since its peak during the market rally in early March. According to Santiment’s data, the number of Ethereum whale transactions fell from more than 115,000 whale transactions between March 13-19 to 31.8 thousand between August 21-27 – only about a quarter of the number of March whale transactions .

The decline is highlighted by the low volatility of ETH in recent months, with the only exception being the market rally on May 20th and the crash on August 5th. Whale activity often peaks when volatility increases, Santiment analysts noted.

ETH Technical Analysis: Ethereum Could Bounce Around Key Support Level

Ethereum is trading around $2,450 on Tuesday, down 2.5% on the day. Over the past 24 hours, ETH has seen $26.94 million worth of liquidations, with long and short liquidations accounting for $22.13 million and $4.81 million respectively.

On the 4-hour chart, ETH’s upward movement was restricted by a convergence of the 200-day, 100-day and 50-day simple moving averages (SMA) in the European trading session. As a result, ETH is attempting a move down into a key rectangle with support and resistance levels at $2,400 and $2,817 respectively.

ETH/USDT 4 Hour Chart

ETH may rally around the $2,400 support level and start another upward move, but only after it could liquidate $40.8 million worth of positions at the $2,424 level, according to Coinglass data.

A move outside the key rectangle will likely determine the next ETH price trend. A breach of the $2,400 support level could send ETH to $2,111. A successful breakout above the $2,817 level and SMA resistance will push ETH towards $3,237.

The Relative Strength Index (RSI) and the %K line of the Stochastic Oscillator (Stoch) are trending below their median lines, indicating a near-term bearish outlook.