Ethereum is struggling to surpass critical supply levels following a brief surge above $3,300 as the market attempts to stabilize after weeks of sustained selling pressure. Although the rebound has sparked renewed optimism, price action remains fragile and a clear confirmation of the bull market is needed before a broader recovery takes place. Nonetheless, the fact that ETH is close to key levels has led some analysts to start calling for higher prices, arguing that the market could enter a new phase after the recent downtrend.
Supporting this view, CryptoQuant analysts highlighted Ethereum Exchange Netflow spot data showing consistent ETH outflows from spot exchanges during price declines, while inflows are relatively limited during price rises. This pattern suggests a more disciplined supply environment where holders are reluctant to sell on weakness and do not distribute aggressively during rallies.
That said, despite Ethereum remaining below key resistance levels, sell-side pressure appears to be easing. Once demand returns, this type of netflow structure can support more rapid upward moves as there are fewer coins available on exchanges to meet new buying interest. Ethereum is currently stuck between fears of a demise and a never-ending recovery, with the next breakout attempt likely to define the near-term trend.
As exchange outflows continue, ETH supply strengthens.
Ethereum’s recent Exchange Netflow behavior suggests that the latest pullback was met with holding and accumulation rather than widespread distribution. Rather than rushing to dump ETH onto exchanges during bearish periods, many participants appear willing to take on the volatility, reducing the immediate selling pressure that usually accelerates downturns. This supports the idea that supply is tapering off, even though prices are still constrained below key resistance zones and market sentiment remains cautious.
However, Exchange Netflow alone is not sufficient to define direction. A favorable supply structure could still fail if demand remains weak or if macro conditions worsen and investors become risk-averse again. In this scenario, a continuation of the decline cannot be ruled out, even if the exchange rate remains constrained.
That said, in the absence of major systemic stresses, the current netflow profile provides a constructive backdrop for an upside. Lack of supply expansion on declines and limited profit taking on bounces means sellers have no control. When demand returns to Ethereum, the price can respond more efficiently because there is less liquidity readily available on exchanges.
In this sense, on-chain data does not signal an immediate breakout. Instead, it highlights a market structure that appears increasingly ready for upward price action as broader conditions adjust and buyers regain confidence.
Ethereum Bulls Are Fighting Structural Resistance
Ethereum is trying to stabilize above $3,300 after a sharp rebound from December lows, but charts show bulls are still fighting excessive indirect supply. The price recently pushed into the $3,300-$3,400 band, a level that has repeatedly served as a pivot point during the downtrend. Momentum has improved, but ETH is still trading below key moving averages, reinforcing the idea that this move is more of a recovery zone than a confirmed reversal.
The blue moving average overhead continues to slope downward and is above current prices, highlighting that the broader structure remains under pressure. At the same time, the green moving average has flattened near $3,300, adding to the resistance cluster and making a full recovery from this area difficult.
From a market structure perspective, ETH has transitioned from a sharp downtrend to a tighter consolidation since early January, with buyers pushing lower and making higher lows. However, trading volume remains relatively low compared to the selloff in October and November, suggesting confidence is still building.
Featured image from ChatGPT, chart from TradingView.com
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