- Ethereum ETFs recorded $77.3 million in net outflows on Wednesday.
- Wallet related to Elwood Technologies has moved 19,500 ETH to Binance within the past two days.
- Ethereum could bounce off key support level to set new yearly high.
Ethereum (ETH) is down 6% on Thursday following huge exchange deposits by Elwood Technologies and net outflows across ETH ETFs.
Daily digest market movers: Fed rates, Negative flows, ETH exchange deposit
Following the Federal Reserve's decision to keep rates steady at 5.25%- 5.50%, the crypto market has entered a downturn, with Ethereum taking a 6% hit. This also affected the flows seen in Ethereum ETFs.
The combined flows for the nine Ethereum ETFs were negative at -$77.3 million on July 31 as the new Eight failed to soak up $133 million in outflows from Grayscale Ethereum Trust (ETHE).
While ETH ETFs haven't been able to affect ETH's price, Katalin Tischhauser, Head of Investment Research at Sygnum Bank, predicted that they could rake in $5 billion to $10 billion in an interview with Cointelegraph.
She predicted that ETH could rally if/when inflows "turn positive and accelerate" as the market is yet to price in the impact of potential high inflows in ETH ETFs.
Tischhauser noted that ETH could rise to $6,000 if its inflow follows a similar pattern to spot Bitcoin ETFs.
Meanwhile, three wallets related to Elwood Technologies have transferred 19,500 ETH worth $63.66 million to Binance in the past two days, according to data from Lookonchain. This marks the second consecutive time that the wallets' exchange deposits coincided with a crash in ETH's price.
ETH technical analysis: Ethereum could bounce off key support
Ethereum is trading around $3,110 on Thursday, down more than 6% on the day. The price drop triggered over $77.96 million in liquidations, with long and short liquidations accounting for 94% and 6%, respectively.
ETH Long/Short Ratio has declined to 0.92, indicating that most traders expect further price decreases. The support ranging from $2,852 to $2,803 will prove crucial if ETH's price plunges further. ETH has tested this level several times in the past four months, but buyers have always entered the market to prevent a further decline. As a result, a price rise has often accompanied a move to this level.
ETH/USDT Daily chart
Also, most traders are bullish in the long term due to the potential effect of spot ETH ETFs when Grayscale outflows diminish.
Hence, ETH could rise over 30% in the coming weeks to test the $4,093 resistance. A move below $2,800 will invalidate the bullish thesis.
Cryptocurrency metrics FAQs
The developer or creator of each cryptocurrency decides on the total number of tokens that can be minted or issued. Only a certain number of these assets can be minted by mining, staking or other mechanisms. This is defined by the algorithm of the underlying blockchain technology. Since its inception, a total of 19,445,656 BTCs have been mined, which is the circulating supply of Bitcoin. On the other hand, circulating supply can also be decreased via actions such as burning tokens, or mistakenly sending assets to addresses of other incompatible blockchains.
Market capitalization is the result of multiplying the circulating supply of a certain asset by the asset’s current market value. For Bitcoin, the market capitalization at the beginning of August 2023 is above $570 billion, which is the result of the more than 19 million BTC in circulation multiplied by the Bitcoin price around $29,600.
Trading volume refers to the total number of tokens for a specific asset that has been transacted or exchanged between buyers and sellers within set trading hours, for example, 24 hours. It is used to gauge market sentiment, this metric combines all volumes on centralized exchanges and decentralized exchanges. Increasing trading volume often denotes the demand for a certain asset as more people are buying and selling the cryptocurrency.
Funding rates are a concept designed to encourage traders to take positions and ensure perpetual contract prices match spot markets. It defines a mechanism by exchanges to ensure that future prices and index prices periodic payments regularly converge. When the funding rate is positive, the price of the perpetual contract is higher than the mark price. This means traders who are bullish and have opened long positions pay traders who are in short positions. On the other hand, a negative funding rate means perpetual prices are below the mark price, and hence traders with short positions pay traders who have opened long positions.
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers. The author will not be held responsible for information that is found at the end of links posted on this page.
If not otherwise explicitly mentioned in the body of the article, at the time of writing, the author has no position in any stock mentioned in this article and no business relationship with any company mentioned. The author has not received compensation for writing this article, other than from FXStreet.
FXStreet and the author do not provide personalized recommendations. The author makes no representations as to the accuracy, completeness, or suitability of this information. FXStreet and the author will not be liable for any errors, omissions or any losses, injuries or damages arising from this information and its display or use. Errors and omissions excepted.
The author and FXStreet are not registered investment advisors and nothing in this article is intended to be investment advice.
Recommended Content
Editors’ Picks
Bitcoin recovers above $98,000 as Eric Trump encourages WLFI to add BTC
Bitcoin price recovers slightly, trading above $98,000 at the time of writing on Thursday after losing nearly 5% in the last two days. Eric Trump encouraged the addition of BTC to their family-backed crypto platform WLFI portfolio, which may be supporting Bitcoin’s recovery.
Bonk Price Forecast: 2.02 trillion BONK coins will be burn
Bonk price recovers slightly on Thursday after falling over 5% so far this week. BONK announces it will burn 2.02 trillion tokens to celebrate the BONKdragon event and the 2025 Lunar New Year.
Can XRP bounce back? SEC actions may favor Ripple in ongoing appeal
XRP is down 3% in the early hours of Thursday as crypto community members anticipate that the Securities and Exchange Commission's (SEC) appeal of the ruling in its case with Ripple will likely not stand following latest developments under the new administration.
Dogecoin price flashes death cross signal as Elon Musk grills US Treasury
Dogecoin price stabilized around the $0.26 level on Wednesday amid a 22% weekly decline as crypto markets tumbled further. Elon Musk’s latest ‘DOGE’ tweets amid an ongoing face-off with the US Treasury have sparked testy market reactions.
Bitcoin: BTC in positive tone ahead of third highest-returning month
Bitcoin (BTC) price hovers around $104,000 on Friday after bouncing off its 50-day Exponential Moving Average earlier this week. A K33 Research explains how Nvidia’s big drop in stock valuation this week, driven by DeepSeek, affected Bitcoin’s price.
The Best Brokers of the Year
SPONSORED Explore top-quality choices worldwide and locally. Compare key features like spreads, leverage, and platforms. Find the right broker for your needs, whether trading CFDs, Forex pairs like EUR/USD, or commodities like Gold.