ETH Plummets on Trump's Trade Policies, Supply Surge Adds Pressure

Ethereum (ETH) has been trading within a narrow price range for most of February, struggling to gain momentum. However, the recent market-wide downturn, triggered by Donald Trump's trade policies, has pushed ETH to multi-month lows. Investors are now questioning whether March will bring further declines or a potential rebound.

The steady surge in ETH's circulating supply is a cause for concern for market participants in March. According to Ultra Sound Money, 66,350 ETH coins, valued above $138 million at current market prices, have been added to the altcoin's circulating supply in the past 30 days. When more ETH tokens enter circulation, the overall supply available for purchase increases. If demand fails to keep pace, this surge in supply can exert downward pressure on the coin's price as more tokens become available for selling.

ETH's rising exchange balance is another reason to worry. After it plummeted to a year-to-date low of 17.27 million ETH on February 21, it has since rocketed. At press time, 17.67 million ETH coins are held on exchange wallet addresses, climbing 2% over the past seven days. ETH's exchange balance tracks the number of coins held on exchange addresses. When this balance spikes, a large amount of ETH is being moved onto exchanges, often signaling that holders are preparing to sell. This increase in sell-side liquidity has added to the downward pressure on the coin's price, especially as selling activity continues to outweigh buying demand.

Despite ETH's performance, some analysts believe this could present a buying opportunity for those looking to book gains in March. In an interview with BeInCrypto, Santiment analyst Brian Quinlivan opined that ETH's current price levels may offer an attractive entry point for long-term investors. According to Quinlivan, both short-term and long-term ETH holders are deeply in the red, a condition rarely seen among the top 50 cryptocurrencies. Historically, such moments of capitulation have preceded major price rebounds, as accumulation from large investors tends to follow periods of heavy selling.