- Ethereum exchange balances have dropped to their lowest level since 2016.
- ETH remains structurally bullish as long as it holds above the 21-week EMA.
- Short-term weakness points to $3,800 support and $4,400 resistance as key levels.
Crypto analyst EGRAG Crypto pushed back against bearish sentiment surrounding Ethereum (ETH) on social media, noting that while many traders are calling for a crash, the long-term bullish technical structure remains intact.
According to the analyst’s weekly chart, ETH has not yet closed below the 21-week EMA, a key trend indicator. He explained that ETH remains “in the most bullish setup” until prices drop below the 21 EMA with strong volumes.
EGRAG’s chart shows multiple retests around $3,750 to $4,000, followed by breakouts and now another retest phase. As long as bulls defend this area, the longer-term outlook includes upside projections as high as $12,300, though traders remain focused on nearer resistance.
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Exchange Exodus: Ether Balances Hit 2016 Lows
On-chain data add weight to the bullish thesis. Glassnode reported that Ethereum balances on centralized exchanges dropped to 14.8 million ETH, the lowest level since 2016. Exchange reserves have fallen almost 50% in two years, with another 20% decline since mid-July.
Large withdrawals are flowing into cold storage, staking, and DeFi. CryptoQuant data backed this trend, showing the Ethereum exchange supply ratio at 0.14, its lowest in nearly a decade. Large-scale withdrawals are accelerating, with net outflows hitting 2.18 million ETH this week, a level seen only five times before.
This kind of supply squeeze historically reduces selling pressure, leaving less ETH available for quick liquidation. For long-term holders, that dynamic is a bullish anchor.
Short-Term Pressure: ETH Eyes $3,800 Support
According to CoinMarketCap data, ETH has shown short-term weakness, dropping below $4,033 after a 3% daily dump. The price action fell below the Bollinger Band midline, with widening bands signaling higher volatility ahead.
Meanwhile, the RSI dipped to 34.74, near oversold territory, i.e., possibility of a reversal are high.
While the MACD is deep in negative territory, immediate support lies in the $3,800–$3,600 zone, while bulls need to reclaim $4,400 to restore upward momentum.
A successful breakout above $4,400 could open the path to $4,773 and eventually the psychological $5,000 level.
Related: Ethereum Price Prediction: ETH Faces Pressure At $4,100 Despite SEC Boost For ETFs
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Source: https://coinedition.com/ethereum-holds-4000-with-exchange-supply-at-2016-lows/