Ethereum has recently continued its upward trend that started around $2,400, and is currently engaged in a fierce battle around the important resistance level of $4,400. This price range has historically been a critical point for market reversals, and the market is at a decisive moment. It is worth noting that while long-term on-chain data still conveys bullish signals, short-term market volatility risks cannot be ignored.
Intense tug-of-war around $4,400: Long-term on-chain bullish signals coexist with short-term risks.
From a long-term on-chain data perspective, Ethereum holdings have significantly increased. Since 2022, the overall supply ratio on exchanges (ESR) has been declining, indicating weakened seller liquidity, with more investors choosing to hold rather than sell.
However, short-term risks still exist, especially in the performance of major exchanges: since the beginning of 2025, ESR has shown an upward trend, with significant inflows, which usually indicates an increase in market selling pressure. The long-term macro positives contrast with short-term tactical caution, suggesting that the market may experience significant volatility.
Leverage and capital flow: Short-term volatility factors dominated by bulls.
Futures data shows that leveraged positions have rapidly increased in recent days, indicating obvious signs of 'overheating' in the market.
While leveraged trading can enhance upward momentum, a sudden reversal in market sentiment may trigger large-scale forced liquidations, leading to a rapid price drop. Historical experience shows that when prices approach key resistance levels, overheating in the derivatives market often signals an imminent sharp correction. The most critical question now is: can the bulls continue to maintain market dominance without triggering liquidations?
In terms of capital flow, the net outflow of Ethereum reached $245.57 million on August 10, continuing the trend of asset withdrawal from exchanges. This net outflow usually indicates that investors prefer to transfer assets to self-custody wallets, showing an enhanced accumulation intent and alleviating short-term selling pressure.
However, the positive signal from the ESR indicator suggests that some traders are still transferring tokens back to centralized exchanges, indicating that potential selling pressure still exists.
Is the breakthrough feasible? The game between bulls and bears affects the future market direction.
Although the RSI indicator suggests overbought risks, the overall structural trend of Ethereum and on-chain data still support the possibility of breaking above $4,400.
The continuous outflow of funds from exchanges, the overall market ESR declining, and a significant accumulation trend are expected to offset the short-term pressure from the rise in coin ESR and high leverage. If the bulls can maintain their current momentum, ETH is likely to target $4,800, further consolidating the upward pattern while alleviating the short-term overheating adjustment pressure in the market.
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