What Do On-Chain Data Show on Ethereum (ETH) Now? Analysts Warned

Cryptocurrency analytics firm CryptoQuant has released a new analysis of the notable activity in the Ethereum (ETH) market. According to the company’s data, the strong upward wave in the price of ETH is being supported by heavy inflows on the Binance exchange.

The analysis noted that net inflow data indicates ETH has been sent to the exchange, which could mean two different things: potential selling pressure or use as collateral for margin trading. It was noted that ETH has reached an all-time high (ATH), but the real question is whether this level can be maintained.

Meanwhile, Binance ETH open interest data has reached record levels. This indicates intense speculative activity among investors and an increasingly volatile market. While Bitcoin continues its upward trend, warnings have been issued that Ethereum could be subject to sudden and sharp price fluctuations and frequent long-short traps.

CryptoQuant also argued that funding rates remain neutral, creating an uncertain picture. While speculative volumes are peaking, funding remaining neutral means even small price fluctuations can lead to large short or long liquidations.

Finally, the analysis noted that the large trading volume on Binance suggests that market sentiment is currently stuck in neutral territory. While the balance between bulls and bears persists, long-short traps are becoming increasingly dangerous. CryptoQuant noted that inflow data should be closely monitored, as continued inflows could lead to a pause in ETH and trigger a new correction wave.

*This is not investment advice.

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