Key Takeaways
Ethereum’s current path higher is backed by exchange outflows. Heavy liquidation clusters between $4,200 and $4,400 mean short-term volatility, which could intensify before a sustained breakout.
Ethereum [ETH] exchange balances have dropped to a nine-year low of 14.88 million ETH, with nearly $2 billion worth of tokens withdrawn in just one week.
This sharp decline highlights a clear trend of accumulation, as investors reduce their exposure to exchanges and strengthen self-custody positions.
Historically, falling exchange balances have reduced selling pressure, often creating favorable conditions for bullish rallies.
Therefore, the current outflow momentum may be laying the groundwork for Ethereum’s next significant leg upward, strengthening the case for a potential long-term push beyond key resistance levels.
A pullback before $5K?
At press time, Ethereum was trading around $4,253 after a 6% intraday drop, showing signs of cooling following its recent rally to $4,783.
The price movement pointed to a possible pullback to the $4,000 support zone before another attempt to retest the $5,000 level.
Short-term corrections often precede stronger upswings, especially when broader metrics align with accumulation trends.
The Directional Movement Index (DMI) strengthened this outlook.
The ADX at 46.42 confirmed a strong ongoing trend, while +DI at 30.97 stayed well above –DI at 15.47, reflecting that bullish momentum still outweighed bearish pressure.
However, a short-term correction remained likely, and defending $4,000 is crucial to sustain Ethereum’s path toward higher resistance.
Source: TradingView
How are Ethereum traders positioning themselves?
Derivatives data from Binance showed that long accounts dominated at the time of writing, with 64.36% compared to 35.64% short positions.
The Long/Short Ratio of 1.81 reflected strong bullish bias among traders, who anticipated further upside.
This positioning suggested confidence that Ethereum will eventually reclaim its upward trajectory despite short-term volatility.
However, such aggressive long positioning can also amplify risk if price drops further, potentially triggering large liquidations.
Market participants should carefully monitor leverage exposure, as imbalances in positioning often intensify both rallies and corrections in highly volatile conditions.
Ethereum’s rising attention across social media
Ethereum’s Social Dominance has climbed to 10.16%, with earlier spikes exceeding 17% in recent weeks.
This rising attention reflected increasing discussions among retail and institutional participants, signaling a heightened level of market interest.
Higher social dominance often accompanies key price inflection points, suggesting sentiment is playing a growing role in ETH’s trajectory. However, social hype alone does not guarantee sustainable growth.
While stronger visibility bolsters investor confidence, Ethereum still requires technical confirmation and continued accumulation trends to fully validate its long-term bullish outlook.
What do liquidation clusters reveal?
The Binance ETH/USDT liquidation heatmap highlights heavy liquidation zones between $4,200 and $4,400, levels that have recently seen increased activity.
These clusters show where leveraged positions are most vulnerable, potentially fueling sharp volatility if price tests those levels again.
Therefore, clearing this zone successfully could trigger renewed upside momentum toward $5,000. However, repeated rejections may drive further downside pressure in the short term.
As a result, traders should remain vigilant, since liquidation-driven moves can accelerate Ethereum’s price swings beyond typical technical expectations.
Can Ethereum sustain momentum toward $5K?
Ethereum’s exchange outflows, strong derivatives positioning, rising social interest, and liquidation dynamics all point toward a buildup of bullish energy.
While a retest of $4,000 appears likely in the short term, the overall structure still supports the possibility of a breakout rally.
Therefore, if Ethereum maintains accumulation trends and clears key resistance, the road toward $5,000 remains well within reach.
