Ethereum Eyes Breakout—but Exchange Inflows Spark Caution

• Exchange inflows remain high while weak job data and political noise drag on crypto sentiment.
• Ethereum eyes $2,800 resistance, but price volatility and bearish derivatives outlook keep traders cautious.

Ethereum traded just under $2,500 on June 7 after a sharp sell-off. The drop followed a surge in exchange inflows—117,000 ETH moved to trading platforms, the second-largest total since April 24. That shift signaled growing selling pressure as traders reacted to broader market unease.

A political clash between Donald Trump and Elon Musk over a proposed “big beautiful bill” seemed to act as a catalyst. The price had already dropped 7% on June 5, and within two days, profit-taking exceeded $600 million. Most of the ETH sold came from wallets that had held the tokens between 90 days and two years, suggesting that mid-term holders decided to cash out.

Exchange inflows continued to outweigh outflows, reinforcing bearish momentum. Analysts from Crypto Finance noted increased hedging activity. Risk reversals—a measure of sentiment in the options market—flipped deeply negative. The 10-day risk reversal fell from +8.82 to -7.27, while the 25-day reading dropped from +2.59 to -2.95, showing traders are paying more to protect against further downside.

Crypto Confidence Falls Amid Weak Jobs, Bond Market Shift

The recent U.S. job report has created more hesitation in financial markets. Only 139,000 new jobs were added in May, and the unemployment rate remained at 4.2%. At the same time, the 10-year Treasury yield climbed above 4.5%, showing bond investors are still concerned about inflation and interest rate pressures.

ZeroHedge analysts drew attention to a large gap between the two employment surveys. The commonly cited payroll figure from the establishment survey showed modest growth. But the household survey, which some view as more reflective of actual employment conditions, showed a loss of 696,000 jobs. The total number of employed dropped to 163.273 million, down from 163.969 million.

When labor market data appear weaker and bond yields rise, investors often reduce exposure to riskier assets. This shift in sentiment typically leads to sell-offs in more volatile markets. Cryptocurrencies, such as Ethereum, experience sharper declines as caution grows and capital moves toward perceived safer investments.

Ethereum still in range, analyst flags $4,000 target

The cryptocurrency’s price dropped below the lower boundary of a rising wedge pattern, finding support at $2,400. Since then, Ethereum has been climbing again and is currently testing the wedge’s lower boundary. If sellers push the price back below $2,400, there’s potential for another drop toward the $2,260–$2,110 range.

However, if buyers regain control and push past $2,530, Ethereum could challenge the upper resistance between $2,750 and $2,850. Some traders are looking at this level closely. Analyst Ted Pillow posted on X on June 7 that, “$ETH [is]still trading within the range.” He added that reclaiming $2,800 could “open the door for a rally to $4,000.”

In terms of market indicators, the Relative Strength Index (RSI) has moved above neutral territory again, hinting at a modest shift in momentum. The Stochastic Oscillator also climbed out of oversold territory, suggesting bearish pressure might be slowing.

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