Ethereum Watch

• Staked ETH grows to a new historic high but market excitement is still at bay.
• ETH may lend itself to the bulls if these price action finding prove accurate.

Although ETH has been stuck in limbo for the last two weeks, it has continued to exhibit healthy growth in other areas. The amount of staked ETH has particularly maintained an upward trajectory and recently reached new highs.

Read Ethereum’s [ETH] price prediction 2023-24

The latest Ethereum data revealed that the amount of the cryptocurrency currently staked reached a new high at 22.8 million ETH. This was an important observation for the Ethereum network because it underscored a long-term focus. ETH holders staking their coins are more focused on a longer time frame and passive gains.

Staked ETH means those coins are dormant and hence not actively being moved around in the market. This fits in with the narrative of a low active supply. One of the latest Glassnode alerts revealed that ETH supply last active just reached a new four-week low. This was also reflected by the latest slowdown in trading activity across the crypto market.

📉 #Ethereum $ETH Amount of Supply Last Active 1d-1w (1d MA) just reached a 1-month low of 1,445,821.097 ETH

Previous 1-month low of 1,449,734.130 ETH was observed on 13 May 2023

View metric:https://t.co/u02oWdxYh5 pic.twitter.com/lgtBWSaf1T

— glassnode alerts (@glassnodealerts) May 24, 2023

Assessing ETH’s short-term fate

ETH’s price action has been relatively dormant despite the surging amount staked. But can its latest characteristics reveal where it was headed in the short term? Perhaps its bearish performance in the last 24 hours may offer some useful insights. A 2.8% pullback occurred at the time of writing after a brief push above the 50% RSI level.

A bearish pullback ensued the last time that the price pushed above the RSI mid-point. The current reaction to another attempt has already yielded some selling pressure and could signify the start of another wave of selling pressure.

If the above observations lead to price weakness, then ETH might lose its current support near the $1,780 price level. The price may slip below $1700 and if that happens, traders should watch out for support near the $1,641 and $1,510 price levels.

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As far as on-chain observations are concerned, network growth fell significantly in the last five days, almost to the lowest four-week levels. This was despite a surge in on-chain volumes during the same period.

Any short-term sell pressure might be short-lived because whales have been accumulating.  The supply held by top addresses was now at its highest level in the last four weeks. This was despite the drop in transaction count which reflected the latest market conditions thus underscoring low network activity and low demand.

ETH was thus at the mercy of whales which might tire of accumulating and instead contribute to selling pressure at any moment. An unexpected parabolic move in the pace of accumulation would change the fate to a potentially bullish one.

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