Financial markets were closed in the USA, which was on holiday on July 4 due to Independence Day. The fact that the USA was on holiday and the markets were closed directly benefited the crypto money markets, and the largest crypto currency Bitcoin (BTC) exceeded $ 20 thousand and Ethereum (ETH) $ 1 thousand 100. However, Ethereum's bullish momentum can be deceptive.
ETH, the world's second largest cryptocurrency, has risen to $1,155, with an increase of more than 10% in the last 24 hours, after close to falling below a thousand dollars again.
Concerns about the US economy falling into recession and the bankruptcy of a number of cryptocurrency companies have severely battered ETH over the year. Considering the weak macro environment, the recent price jump in Ethereum could be short-lived. The low trading volumes, especially on the day of the US Independence Day holiday, may have been used as a tool for the sharp rise. Recent on-chain data shows that investors are rapidly moving their ETH to exchanges, which may leave the altcoin vulnerable to further selling.
Data from on-chain analytics company Santiment shows that the amount of ETH moved to exchanges has steadily increased as the price approaches $1,000. Currently, the amount of ETH on exchanges is at its highest level in six months. This means that traders and investors have largely unloaded their ETH and are ready to dump it. The increase in the amount of ETH on exchanges shows that there is little room for strong price recovery. Santiment warned investors by deducting the following note in its analysis;
“As ETHs continue to move rapidly to exchanges, the amount of ETH on exchanges is close to breaking 2022 records. As the amount of Ethereum in exchange wallets increases, the risk of disposal is higher.”
On the other hand, according to many market experts, the recent rise in Ethereum consists of the dead cat bounce seen in bear markets, which is a temporary recovery period after the price pullback.