Ether (ETH) holdings on the exchanges continue to fall, despite being at historic lows. This trend is indicative of the shortage of ETH on major exchanges after the Ethereum 2.0 depository wallet was released for equity offerings.

As Cointelegraph previously reported, the stock has reached $4 billion in January 2021, making about 2% of ETH’s offering included in the Eth 2.0 filing.

The low supply of ETH on exchanges should reduce the overall selling pressure on the assets, especially if the demand for ETH increases with the rapid growth of the DeFi market.

ETH all foreign exchange reserves against BTC. Source: CryptoQuant

Why does ETH not have strong upside momentum?

Relative to the amount of ETH circulating in the currency market, the price of ETH has not experienced as much bullish momentum as it did in early February.

According to analysts at the CryptoQuant channel data analysis platform:

The $ETH reserve on all central exchanges is falling, while the $BTC reserve has been rising and falling since January this year.

There are two main reasons why ETH has consolidated over the past two weeks. Firstly, the sharp rise in the interest rate on 10-year US government bonds reduced the general market risk. Second, Bitcoin is outperforming ETH, which weakens Ether’s momentum.

However, traders and network analysts expect ETH to recover in the near future.

ETH 1-day chart with key levels. Source: TradingView.com, Cactus

A pseudotrader known as Cactus said that ETH is heading for a new all-time high, based on the technical structure of the market, and suggested that it will be at $1,750. He wrote:

As long as we continue to see daily selling and prices close above the $1750 area, we can expect further gains in the near term.

Moreover, the recent decline in the price of BTC has not led to a significant drop in ETH, while the ETH/BTC pair has even seen a surprising rebound, meaning that the up-cycle has remained intact.

The next big wave of momentum could come after this period of consolidation and contraction has ended. This next wave of momentum should take Ether well above $2,000, according to Cointelegraph market analyst Michael van de Poppe in his latest analysis.

Against the backdrop of declining foreign exchange reserves and a favorable technical market structure, CryptoQuant CEO Ki Yang Zhu noted that ETH has risen to 16th place. March was the second highest hourly product in 2021.

Outflows from the stock market are usually a sign of positive market sentiment, as it likely means that an institution or wealthy investor is accumulating ETH and sending it to a self-managed portfolio, Key said :

We just had the second largest outflow of $ETH this year, judging by the hourly data. There seems to be a growing liquidity crisis on the central sales exchanges. It’s a cow.

The drop in FX reserves alone may not be enough to prove a short-term uptrend for ETH through Ethereum 2.0.

In the first few weeks after the launch of Lido, the injection vial installation platform, more than 60,000 injection vials were installed via Ethereum 2.0.

Thanks to the Lido exchange rate and Eth 2.0 contract deposits, ETH has seen its foreign exchange reserves decline significantly. However, in the absence of major catalysts, bitcoin stocks traded on exchanges also saw a significant decline during the same period.

In this context, it is important that other key data points in the chain, such as. B.. B. Rising trade volumes and short-term spikes in foreign exchange outflows complement the overall downward trend in foreign exchange reserves and strengthen the case for a broader recovery in the near term.

Government bond yields and equity market dynamics are crucial

Cryptocurrencies are likely to show some correlation with US Treasury bond yields and the stock market in the near future.

Over the past month, the crypto market showed a strong inverse correlation with 10-year government bond yields.

BTC/USD versus 10-year Treasury yields (orange). Source: View of the shop

When Treasury bond yields hit 1.6 percent in late February, the price of bitcoin fell to a new low of $43,000, taking Ethereum and other leading alternative cryptocurrencies with it.

As long as Treasury yields remain stable and US stimulus measures continue, the outlook for Ethereum remains bullish through March.

frequently asked questions

Can Ethereum outperform Bitcoin?

Data from the Blockchain Center shows that Ethereum has already surpassed Bitcoin in terms of number of nodes, number of transactions and total transaction value. …

Is it better to trade bitcoin or ether?

Bitcoin transactions are primarily monetary transactions; Ethereum transactions can be executable code. Transactions on the Ethereum network are much faster than on the Bitcoin network. Bitcoin is primarily a store of value and a medium of exchange, while Ethereum is not. Ethereum was founded to complement Bitcoin, but eventually became a competitor.

Ethereum beef ?

Ethereum (ETH/USD) is in a strong uptrend. The bullish momentum is similar or even stronger than bitcoin’s recent push above $50,000. Ethereum (ETH/USD) is in a strong uptrend. The bullish momentum is similar or even stronger than bitcoin’s recent push above $50,000.

Ethereum Shares,Ethereum Prices,Cryptocurrency Prices,Bitcoin News Today,Feedback,Privacy Settings,How Search Works

frequently asked questions

Can Ethereum outperform Bitcoin?

Data from the Blockchain Center shows that Ethereum has already surpassed Bitcoin in terms of number of nodes, number of transactions and total transaction value. …

Is it better to trade bitcoin or ether?

Bitcoin transactions are primarily monetary transactions; Ethereum transactions can be executable code. Transactions on the Ethereum network are much faster than on the Bitcoin network. Bitcoin is primarily a store of value and a medium of exchange, while Ethereum is not. Ethereum was founded to complement Bitcoin, but eventually became a competitor.

Ethereum beef ?

Ethereum (ETH/USD) is in a strong uptrend. The bullish momentum is similar or even stronger than bitcoin’s recent push above $50,000. Ethereum (ETH/USD) is in a strong uptrend. The bullish momentum is similar or even stronger than bitcoin’s recent push above $50,000.

ethereum stock,eth price,cryptocurrency prices,bitcoin news today,Feedback,Privacy settings,How Search works

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