Ethereum: very positive inflows into ETFs, but has the price temporarily stalled?

At the beginning of May there were decidedly positive inflows into spot Ethereum ETFs traded on traditional US exchanges.

In fact, starting from the first of May there were four consecutive positive sessions, after four previous consecutive negative sessions.

The amounts were also quite significant, although declining.

Daily inflows into ETFs

It started on Friday, May 1st with more than $100 million of daily inflows.

The record of over $1 billion is very far away, but those $100 million are still the highest figure in recent weeks.

On Monday, May 4th it had fallen to 61 million, but on Tuesday it rose again to 97.

Yesterday, however, they fell to 11 million, giving the impression that today this mini-trend could also come to an end.

In total, in four sessions almost $300 million flowed in, with a daily average of 67.

By contrast, in the previous four sessions less than 200 million had flowed out in total, with an average of only 46 million in daily outflows.

It is clear that there has been a change in trend (even if it would be better to call it a mini-trend), but it could change again.

The price of Ethereum

The fact is that what may have brought back significant daily inflows was the rise in the price. And this may also have stopped precisely yesterday.

This rise actually did not start on the first of May, but already on March 30th.

The problem is that initially it was only a rebound, given that from mid-month in about two weeks it had fallen from just under $2,400 to below $2,000.

The $2,300 level was then recovered already shortly before mid-April, and since then the price of Ethereum has in fact been limited to moving sideways.

Yesterday, however, it seemed that, after as many as four failed attempts to move back stably above $2,400, it could finally be the right opportunity, also thanks to the inflows into ETFs, but this was not the case.

In theory, yesterday’s attempt could still be underway, but for now it seems more likely that the mini-trend that began on Friday, May 1st has ended.

What happened

The fact is that this week, starting already on Monday, several sales of $ETH occurred once $2,350 was exceeded, most likely as profit-taking on short-term long positions opened at the end of April below that figure.

In particular, several purchases took place between April 20th and 21st around the $2,320 level, and a meager +,% was enough to trigger the sales.

However, it is possible that those purchases were short-term leveraged long positions, and assuming 10x leverage the gain should have been more than 15% in just over a week. These days many speculators can consider themselves more than happy to take home such gains on Ethereum.

Shifting the analysis from trading to holding, however, the scenario changes.

In fact, in recent months accumulations of $ETH below $2,150 have been recorded by holders, who for now have not sold, or at least have not sold much.

To tell the truth, above $2,300 there have been some sales by holders, but in a percentage that is too low to be considered significant.

The forecasts

The upward mini-trend at the beginning of May seems to have run out, with yesterday’s sales.

However, it is not possible to rule out that sooner or later another one may start.

The point is that, broadening the time horizon of the analysis, the real upward trend is actually the one that began on February 25th. Not only does this trend for now still seem to be underway, but the fact that the holders who bought below $2,150 have not yet sold much suggests that perhaps it could continue further.

Within this medium-term trend, however, three short-term upward mini-trends can be identified, of which only the second was successful. However, the third and last one (the one that ended yesterday) could in theory also be followed by a fourth upward mini-trend, although for now it is still too early to confirm (or deny) this hypothesis.

For now, however, it is certain that the local low was made on February 6th below $1,750, but it should not be forgotten that in the event of the end of the medium-term upward trend, if a medium-term downward trend were to begin, in theory there could also be room for new lows already by the end of the year.