# Ethereum (ETH) Takes a Hit Amid Mixed Updates: Analysis By [ENDEO ](https://paragraph.com/@endeo) · 2024-06-12 --- **_Ethereum products see $69 million net inflows, marking best result since March. Analysing why this is not a silver lining for Ether._** While Ethereum protocol boasts of promising updates, ETH keeps struggling below $3,700. Sharp downtick in social metrics adds advantage for the bears, yet fundamentals spur optimism in Ether’s prospects. But which factors would be leading in the market sentiment? **Ethereum Deposits Emptying Despite Positive Address Momentum** ---------------------------------------------------------------- [Data](https://studio.glassnode.com/metrics?a=ETH&m=distribution.BalanceExchanges) from Glassnode indicates that the amount of Ether (ETH) held on exchanges has reached its lowest point in eight years. ![Ethereum: balance on exchanges (total). Source: Glassnode](https://storage.googleapis.com/papyrus_images/f41137e61495a65ba9bae3b02b0167b9927e7573280362084ce715251171c9ef.png) Ethereum: balance on exchanges (total). Source: Glassnode While this may indicate a decreased speculative interest in Ether, taking place due to post-ETF approval market shock, this marks a strong holding tendency. According to the IntoTheBlock’s [data](https://app.intotheblock.com/coin/ETH), 89% of Ethereum holders are in profit at the current price, which is a strong indicator of a healthy market. ![Ethereum (ETH) trading activity. Source: IntoTheBlock](https://storage.googleapis.com/papyrus_images/3acdce7a8c10de73e8493bcc7dc3e9c25a2d56fcb873073e6cf2c1a1f5237ca2.png) Ethereum (ETH) trading activity. Source: IntoTheBlock The data also reveals that Ethereum is mainly held by whales, with 51% of the asset cited to be concentrated on the large holders’ wallets. What is more, CoinShares recently [reported](https://cointelegraph.com/news/crypto-investment-products-june-2b-inflows) that Ether investment products saw a total inflow of $69 million for the week, hitting the three-month record. This correlates with a notable increase in a volume of transactions exceeding $100k, which proves the institutional and large-scale investor optimism on the long-term Ethereum perspectives due to its exchange-traded funds’ (ETFs) approval. By contrast, overall Ethereum’s sentiment has registered a sharp decline since the beginning of the month. Santiment’s [data](https://app.santiment.net/charts?settings=%7B%22slug%22%3A%22ethereum%22%2C%22ticker%22%3A%22ETH%22%2C%22from%22%3A%222023-12-10T21%3A59%3A59.544Z%22%2C%22to%22%3A%222024-06-10T20%3A59%3A59.544Z%22%7D&widgets=%5B%7B%22widget%22%3A%22ChartWidget%22%2C%22wm%22%3A%5B%22social_volume_total%22%5D%2C%22whm%22%3A%5B%5D%2C%22wax%22%3A%5B0%5D%2C%22wpax%22%3A%5B%5D%2C%22wc%22%3A%5B%22%2368DBF4%22%5D%2C%22ws%22%3A%7B%220%22%3A%7B%22interval%22%3A%221d%22%7D%7D%7D%5D) reveals that Ether’s weighted sentiment indicates a negative rate after its surge in the end of May – just around the ETF-fueled spike. ![Ethereum: weighted sentiment and social volume. Source: Santiment](https://storage.googleapis.com/papyrus_images/32722f5ba3d09b0d5aec5ed0cacd5c442d5a176345bb8c65edfe294fe128bb14.png) Ethereum: weighted sentiment and social volume. Source: Santiment Additionally, an analysis of the social volume showed downticks corresponding to the decreases in weighted sentiment. Despite the weak sentiment, Ethereum still [sees](https://studio.glassnode.com/metrics?a=ETH&category=&m=addresses.NewNonZeroCount) a positive new address momentum. At the writing time, the number of new addresses exceeds 105,000. ![Ethereum: number of new addresses. Source: Glassnode](https://storage.googleapis.com/papyrus_images/dd7d5620c25f38ad918f2c66741562e837cdff1724cb3f840a20c31d2c6de665.png) Ethereum: number of new addresses. Source: Glassnode **Chart Favors Bears** ---------------------- As per Ether’s daily chart, the asset faced heightened selling activity after a short period of consolidation near the $4,000 crucial resistance. This highlights the price level as a key point for short positions. Nonetheless, there is a significant support zone ahead, including the 100-day moving average at $3,431.05 and the 0.5 Fibonacci retracement level at $3,419. This suggests that the current price action may continue its bearish retracement in the short term, with the 100-day moving average and the 0.5 Fib level acting as primary support for buyers. ![ETH/USDT 1D chart. Source: WhiteBIT TradingView](https://storage.googleapis.com/papyrus_images/11aade75cecbcbc52124553de74ed4653b9fd6fb3601fa16681540b4d83ae035.png) ETH/USDT 1D chart. Source: WhiteBIT TradingView The 4-hour chart indicates a strong sideway movement for Ethereum. According to the graph, the aforementioned consolidation in the $4,000 area has formed a head and shoulders pattern, indicating a lack of bullish momentum and an increase in supply. Consequently, this pattern may signalise an eventual bearish reversal, especially with breaking below the neckline of the formation. ![ETH/USDT 4h chart. Source: WhiteBIT TradingView](https://storage.googleapis.com/papyrus_images/1c4f4f47411da364155e8b75b72ce5de0f447222eb1a2da87a160d1fdc3cebc0.png) ETH/USDT 4h chart. Source: WhiteBIT TradingView The seller dominance is also marked by a bearish divergence between the relative strength index (RSI) and the price movement. Currently, the price is at a critical support level of around $3.6K. If sellers manage to breach this pivotal level, continuing the bearish trend is the most likely outcome. Controversial Ethereum updates only emphasize the vagueness of the coin’s trend. While traders received a perfect opportunity to buy, they should closely monitor the upcoming Federal Reserve’s updates on the interest rates in the US – a crucial factor of influence towards the cryptocurrency market. --- *Originally published on [ENDEO ](https://paragraph.com/@endeo/ethereum-eth-takes-a-hit-amid-mixed-updates-analysis)*