Ethereum has been making headlines in the cryptocurrency market recently, with a significant price surge of 29% over the past week. The price of ETH is currently trading at $4,662, inching closer to its all-time high of around $4,800 that was reached back in 2021. This price movement has brought Ethereum within striking distance of the key resistance zone between $4,750 and $4,800, which has historically acted as a significant barrier for the market.
The recent price rally in Ethereum is not just a result of market speculation, but is also backed by unprecedented network activity and on-chain flows. Data from CryptoQuant reveals that daily Ethereum transactions have hit a record high of approximately 1.875 million, indicating a surge in demand for block space and increased engagement across the network.
This surge in on-chain activity, combined with Ethereum’s current price position, sets the stage for a crucial decision point for the cryptocurrency. A breakout above the $4,750 resistance level, supported by sustained transaction volume, could potentially propel ETH into a price discovery phase, surpassing its previous all-time high. On the other hand, if sellers defend this level, we may see a period of consolidation or a retracement towards the $3,950 support area.
While peak network activity often correlates with bullish price action, it can also signal a potential overheating of the market in the short term. This is something to keep in mind as Ethereum tests a historically significant resistance zone while network usage is at an all-time high.
In addition to network activity, exchange outflows are also painting a bullish picture for Ethereum. Analysis from CryptoQuant analyst Burak Kesmeci shows that ETH net flows on exchanges remain strongly negative, with an average daily outflow of 40,000 ETH over the past month. Negative net flows suggest that more ETH is leaving exchanges than entering, indicating reduced selling pressure and increased holding behavior among investors.
Kesmeci attributes the recent strength in outflows to spot ETH ETF activity, highlighting institutional demand as a key driver of price support. As long as the SMA30 (30-day simple moving average) of net flows remains negative, the upward trend in Ethereum is expected to continue. However, a shift into positive territory could signal a shift in market sentiment and potentially weaken buying momentum.
With record transaction counts, sustained exchange outflows, and significant institutional interest, Ethereum is currently operating in a market environment characterized by strong fundamentals and growing demand. Whether these factors will be enough to push ETH past its previous price ceiling remains to be seen, as traders keep a close eye on the $4,750 resistance level for signs of a breakout or rejection.
As Ethereum continues to make waves in the cryptocurrency space, investors and traders alike will be closely monitoring its price movements and network activity to gauge the future direction of the market.