Key Points:
Ethereum bulls are targeting the liquidity area near $2,500, supported by strong technical indicators, including a dragonfly doji pattern and a rebound from a key support zone.
Over 90% of Bitcoin (BTC) supply is in profit, while Ethereum has lagged behind. Swissblock data suggests a potential "catch-up" phase, echoing patterns from previous bull market cycles.
The inflow of funds into spot Ethereum ETFs surged by 68% in June, indicating growing institutional interest in Ethereum.
Ethereum is experiencing a significant recovery, with its price climbing towards the $2,500 mark on June 23. The two-week liquidation heatmap highlights this bullish trend, revealing positive price action as Ethereum aims for liquidity-rich areas above $2,500. These areas may serve as locations where market makers could hunt for stop-loss orders, potentially pulling prices upward like a magnet during a short squeeze.
From a technical perspective, Ethereum recently tested the multi-month support range between $2,100 and $2,200, with this key level holding firm, showcasing strong buyer interest. The three-day chart closed above $2,400, forming a dragonfly doji pattern, which is a candlestick formation that suggests a potential reversal after a range low. This pattern is characterized by a long lower shadow and a bullish close, reflecting early selling pressure from sellers but ultimately buyers regaining control of the market.
The price increase since May also marks the highest trading volume participation since July-August 2022 (during the last bear market), indicating a notable resurgence of interest from retail and institutional investors.
The liquidation heatmap further supports this outlook, showing Ethereum consistently forming higher lows above major liquidation clusters, with the path of least resistance clearly pointing upward. Market makers may play a key role in this liquidity-driven rally. As Ethereum approaches $2,500, the combination of strong technicals and liquidity dynamics suggests a potential breakout.
On-chain analyst Amr Taha noted that on June 23, over 61,000 Ethereum were withdrawn from the Binance platform, a strong bullish signal indicating that traders are moving assets off exchanges, possibly shifting from short-term speculative strategies to long-term holding strategies.
According to the latest data analysis from Swissblock, as the flow of funds shifts from Bitcoin, Ethereum may be on the verge of a significant rise. Swissblock's analysis published on the X platform identified a "Zone 5" accumulation phase, with historical data showing that Ethereum has substantial upside potential during this phase.
The analysis chart highlights five key green zones: these areas mark periods of fundamental alignment, increased profitable supply, and capital rotation, closely resembling the patterns of the bull market cycles in 2017 and 2021. Data shows that currently, over 90% of Bitcoin supply is in profit, indicating limited short-term upside potential, while Ethereum clearly lags behind, with a profit realization rate of less than 80%. Professional analysts point out that this lagging phenomenon is a significant signal that Ethereum is about to start catching up, with the comparison of profit metrics for Bitcoin and Ethereum (ETH) clearly showing that as Bitcoin approaches its peak, funds may have begun rotating into Ethereum.
The research report emphasizes that the current Zone 5 status is highly similar to past periods when Ethereum outperformed the market, with the ETH/BTC ratio nearing multi-year lows, a typical signal of Ethereum being severely undervalued. Current market data highlights a historically recurring pattern—capital flowing from Bitcoin to Ethereum, laying the groundwork for a rally across the entire altcoin market.
Recent data on spot ETF fund flows further confirms this trend of transition. The data shows that in May, Bitcoin spot ETFs attracted $5.23 billion in inflows, which dropped to $2.64 billion by June; meanwhile, Ethereum spot ETF inflows increased from $564 million to $950 million. This change has led to a significant shift in relative ratios, with Ethereum ETF inflows increasing by 68.4%, while Bitcoin inflows decreased by 49.5%.
This favorable volatility change for Ethereum, reaching up to 118%, also clearly demonstrates the accelerating trend of institutional capital rotation. Market analysts believe that institutional investors are likely shifting their capital allocation focus towards Ethereum, further reinforcing Swissblock's bullish outlook on Ethereum.
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This article does not contain any investment advice or recommendations. Any investment and trading activities involve risks, and readers should conduct their own research before making decisions.
Original article: “Ethereum Liquidity Sits Above $2,500: Will ETH Bulls Grab It?”
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