200k Ethereum flows into the exchange, there is more downside in the future?

According to the data on the chain, about 200,000 ETH entered the exchange yesterday, which indicates that Ethereum may soon face more downsides.

The central exchange observes an inflow of 200k ETH

As CryptoQuant pointed out postal, Yesterday, more than 200k ETH entered the exchange wallet. At the current rate, this amount is approximately US$839 million.

The relevant on-chain indicator here is Ethereum Network traffic, Which shows the net amount of cryptocurrency entering or exiting the central exchange. Its value is calculated by taking the difference between inflow and outflow.

When the indicator is negative, it means that the outflow is dominant in the inflow. In other words, investors withdraw more ETH than deposited ETH. This trend is usually good for cryptocurrencies.

On the other hand, positive net traffic means that the exchange receives more Ethereum compared to the amount cancelled. Since investors usually transfer their coins to exchanges to withdraw fiat currency or buy altcoins, the long-term positive value of this indicator may be bearish.

Related Reading | Ethereum scarcity: After the London fork, the supply change of ETH is almost zero

Now, here is a chart showing the trend of the ETH net flow indicator in the past few weeks:

Looks like the indicator has shown a positive spike recently | Source: CryptoQuant

As shown in the figure above, with about 201,000 ETH entering the exchange wallet, yesterday we saw a huge positive net traffic surge.

This is a large amount of Ethereum, as shown in the figure, during this period did not see close to this level of capital inflow.

By the way, an interesting feature in the graph is the huge outflow peak about a week ago.These outflows are approximately 9 billion USD in ETH Withdraw from the exchange in just three days.

The inflows seen yesterday may cause cryptocurrency prices to fall in the short term.However, in the long run, the signs of tokens are still bullish because foreign exchange reserves It has been falling sharply recently.

Ethereum price

At the time of writing, the price of ETH is floating around $420 and has fallen by 10% in the past 7 days. In the past month, the value of cryptocurrencies has risen by 4%.

Related Reading | TA: Ethereum cuts revenue, why this level is the key to new growth

The chart below shows the trend of Ethereum price in the past five days.

Ethereum price chart

ETH's price has moved mostly sideways in the last few days | Source: ETHUSD on TradingView

Since Ethereum hit a record high of more than $480, the price has mostly been on a downward trend. Earlier, the price fell to a low of 3.9k and then returned to the current level.

Featured image from Unsplash.com, charts from TradingView.com, CryptoQuant.com

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