US spot Ethereum (ETH) exchange-traded funds (ETFs) saw inflows on Wednesday, 28th August, following two weeks of consistent outflows. Since trading began on 23rd July, these ETFs have experienced positive flows on just nine occasions.
According to data from SoSoValue, inflows to these ETFs reached $5.84 million on Wednesday, coinciding with a significant rebound in Ethereum prices. Currently, these funds hold $6.9 million in net assets.
The BlackRock iShares Ethereum Trust (ETHA) was a significant contributor to the recent positive inflows, ending a five-day streak of zero flows since 21st August with an $8.4 million inflow on Wednesday. Meanwhile, Fidelity reported $1.26 million in inflows, whereas the Grayscale ETF saw outflows of $3.81 million.
These positive inflows have sparked gains for ETH, which is up nearly 3% in the last 24 hours, trading at $2,541 at the time of writing.
Technical Indicators Point to a Rebound
ETH's recent rebound appears to be driven by buyers, as evidenced by the Relative Strength Index (RSI) bouncing from the oversold region below 30. The RSI line has shown a strong upward movement, forming higher lows and crossing above the signal line, indicating bullish momentum. This crossover also suggests a buy signal and a potential continuation of the uptrend. However, despite this bounce, the RSI remains at 41, prompting caution among buyers until it reaches the neutral level of 50.
The Chaikin Money Flow also indicates increased buying pressure. However, as this metric remains in the negative territory, a shift to the positive is necessary to confirm a sustained uptrend.
ETH's recent price action has seen it bounce from the support level at $2,492 and test resistance at $2,554. Should the uptrend continue and ETH surpasses the $2,600 mark, the next target could be $2,800.
Potential for Correction Amid Market Sentiment
ETH’s recent gains have also allowed the altcoin to outperform Bitcoin (BTC). However, trader DaanCrypto expressed caution on X, noting that this could lead to a correction.
“ETH is doing that thing again where it is somewhat ‘stronger’ than BTC for a few hours. I’m a bit scared as that has usually led to more pain this year,” the trader remarked.
The Ethereum Market Value to Realized Value (MVRV) ratio has dropped to notably low levels, suggesting that ETH might be undervalued and potentially signaling an opportune moment for long-term investors to buy. However, the declining MVRV ratio could also indicate market capitulation following prolonged bearish sentiment around ETH.
Additionally, data from Coinglass reveals that Ethereum funding rates have turned positive, suggesting a rise in long positions and a budding bullish sentiment in the market.
