Ethereum (ETH) price is showing a rare technical signal that was last seen six months ago, just before it rose over 80%. The token is trading around $4,020, down about 1.8% in the past 24 hours, 8.7% in a week, and nearly 10% in 30 days, showing a clear downward trend.
However, the latest on-chain data and familiar momentum patterns suggest this decline may be losing momentum.
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Bullish divergence resurfaces due to rapid increase in foreign exchange outflows
The Relative Strength Index (RSI), which measures the speed and strength of price movements, is showing a bullish divergence. This happens when the price is making a low, but the RSI is making a low. This indicates that selling pressure is easing.
A bullish divergence often signals a possible trend reversal, which means a downtrend may be nearing an end. The last time Ethereum clearly exhibited this pattern was between March 10th and April 21st, when it gained 84.46%. Before that reversal, Ethereum was in a similar decline. The current repetition of this setup could indicate that the current downtrend is nearing a reversal once again.
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Ethereum whales, which are wallets that hold large amounts of ETH, seem to be preparing for this from an early stage. According to on-chain data, the holdings of these addresses increased from 1036 million ETH on October 14 to 100.51 million ETH two days later. This is approximately an additional 150,000 ETH, equivalent to approximately $603 million at current ETH prices.
Although at a slow pace, this accumulation suggests that major companies are repositioning themselves as the market continues to recover.
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At the same time, changes in exchange net positions, which track the amount of ETH entering and exiting exchanges, worsened from -1.55 million ETH on October 10 to -1.94 million ETH on October 15.
Negative numbers mean more coins are leaving the exchange than coming in, a sign of increasing buying pressure as investors move their holdings into long-term storage. This 25% jump in outflows marks the highest level since September 25th. Combined with whale accumulation trends, this could be in anticipation of a potential spike in Ethereum prices.
Ethereum price faces serious test near $4,076
Technically, Ethereum faces immediate resistance near $4,076, with higher targets at $4,222 and $4,557 if the breakout holds. A 12-hour close above $4,076 could confirm the strength of the bullish signal. If this happens, the path to $4,752 and $4,947 (all-time high zone) will be opened.
On the downside, Ethereum has important support near $3,952 and $3,877. A loss of these levels could cause the price to fall towards $3,640, invalidating the bullish trend.
Overall, Ethereum’s setup combines three bullish factors. These include strong momentum signals (RSI divergences), whale accumulation, sharp increases in currency outflows, etc.
If this structure holds and the price moves above $4,076 and $4,222, ETH could once again repeat the same bullish recovery that began in March, one that turned a fading downtrend into a multi-week rally.
