Ethereum (ETH) has risen nearly 10% over the past week, marking improved market sentiment and improved demand for new investors.
The price surge is expected to occur when a broader risk appetite returns to the crypto market, with ETH potentially ready for a breakout towards the $5,000 mark.
Sponsored Sponsors
Ethereum Supply tightens and ETF inflows will skyrocket – $5,000 next?
Ethereum’s Exchange Supply Ratio (ESR) plummeted to the lowest level this year, indicating fewer coins are held in centralized exchanges. At the time of writing, the metric is 0.14, steadily decreasing with each encryption since July 20th.
About Token TA and Market Updates: Want more token insights like this? Sign up for Editor Harsh Notariya’s daily crypto newsletter.
ESR measures the share of circulating supply of ETH in centralized exchange. A higher ESR indicates that more ETH is sitting in exchange, increasing the risk of short-term sales pressure.
Conversely, as ESR decreases, it indicates that holders are redirecting coins to exchanges, often private wallets and management solutions, as is now. This reduces the immediate availability of ETH for sale.
Historically, such a decline in exchange balance has often preceded extended gatherings, increasing the likelihood of $5,000 in the near future.
Furthermore, institutional confidence shows signs of a revival. Spot Ethereum Exchange-Traded Funds (ETFs), which saw capital outflows last week, have recorded rebounds of inflows in the past few days.
Sponsored Sponsors
Between September 8th and 12th, Spot Ethereum Investment Funds recorded a capital inflow of $638 million, according to Sosovalue.
This turnaround reflects a critical shift in emotions, reinforcing the case of a lasting push to the $5,000 level, as key investors spin back into ETH.
Ethereum has $4,664 in support as the $5,000 rally is focused on
On the daily chart, the ETH is held on a new support floor formed at $4,664. The sustained strength in this zone could make the path to the highest ever retest at $4,957.
A successful breakout beyond this level could trigger a rally to the planned $5,000 milestone.
But this bullish outlook depends on protecting the $4,664 floor. Failure to maintain this level can put your ETH under updated downside pressure, with the next key support sitting around $4,211.
