Ethereum Bulls Eye $4K as Whales Accumulate Despite Rising Reserves

Ethereum, the second-largest cryptocurrency by market capitalization, has been displaying multiple bullish signals, suggesting a potential price rebound. However, the rising exchange reserves have raised concerns among investors.

Over the past two weeks, Ethereum has experienced a significant decline, falling from approximately $2,805 on February 23 to just above $2,200 at the time of writing. This drop has erased around $80 billion from ETH's market capitalization. Despite this sharp pullback, crypto analysts have identified several bullish indicators that could signal an impending price reversal.

Crypto analyst Merlijn The Trader has highlighted that Ethereum is following the Wyckoff Reaccumulation Pattern, which suggests that the asset may be entering an accumulation phase before a potential upward movement. The analyst also noted that the "spring phase" has just been triggered, indicating a possible bear trap where a brief dip below support levels misleads sellers, potentially setting the stage for a rally. A bounce from this level could see ETH climb to $4,000.

In a separate post, Merlijn The Trader also pointed to a bullish divergence in Ethereum's 4-hour chart. According to the analyst, ETH's next immediate target is $2,700 before moving higher. Fellow crypto analyst CryptoGoos echoed these sentiments.

Beyond technical indicators, whale activity has added to the bullish sentiment surrounding ETH. Crypto analyst Ted noted that an Ethereum whale bought 17,855 ETH worth $36 million at an average price of $2,054, further suggesting that the digital currency may not be headed downwards.

On the bearish side, crypto analyst Ali Martinez pointed out that ETH reserves on exchanges have been steadily rising. Over the past two weeks, more than 610,000 ETH has been transferred to exchanges, which could increase selling pressure. Martinez's analysis aligns with a recent report that found that despite ETH's Relative Strength Index (RSI) being at a multi-year low, there could still be further downside in store for the digital currency.

Indeed, ETH has been marred by significant bearish sentiment due to its relatively weak price performance over the past two years compared to cryptocurrencies like Bitcoin (BTC), Solana (SOL