Ethereum Faces 4.32% Exchange Reserve Surge, 10.07% Open Interest Spike at $1,860 Resistance

Ethereum is currently testing a significant resistance zone at $1,860, with on-chain data indicating that nearly 4.54 million wallets hold 5.58 million ETH between $1,850 and $1,880. This concentration of holdings represents a major barrier, as many of these investors may be looking to exit at break-even, potentially creating strong sell pressure. The psychological significance of this level, coupled with recent gains, adds to the challenge Ethereum faces in breaking through this resistance.

Exchange-related metrics also raise concerns about potential volatility. The total exchange reserve has climbed by 4.32%, suggesting that more ETH is being transferred to exchanges. This trend typically indicates that investors are positioning for potential selling, especially as prices test resistance. While inflows to derivatives platforms could imply hedging, the uptick during a price climb often points to profit-taking preparations. Consequently, the market may encounter higher volatility if this trend continues alongside waning buy-side demand.

The derivatives market shows aggressive long positioning, which may be fueling Ethereum’s rally. Open Interest has surged by 10.07%, reaching $13.1228 billion, reflecting a wave of new positions. The Long/Short Ratio on Binance indicates that 59.5% of traders are long, while only 40.5% are short. Although this long dominance reflects bullish conviction, it also introduces liquidation risk. If Ethereum fails to break above resistance convincingly, overly leveraged long traders could accelerate downside pressure through forced liquidations.

On-chain whale behavior does not confirm bullish momentum. Large Transaction Volume has dropped by 5.44%, flashing a bearish signal. Such drops often suggest either hesitation or strategic exits by large holders. Typically, a rise in Large Transaction activity precedes or accompanies major breakouts, but the current decline may reflect caution due to Ethereum’s proximity to a well-defined sell zone. Therefore, limited whale support weakens confidence in the rally’s sustainability.

Despite cautious on-chain signals, Ethereum’s price structure looks technically optimistic. A clean breakout above a long-term descending trendline has occurred alongside the formation of an inverted head and shoulders pattern. This classic bullish reversal setup suggests the potential for a sustained uptrend if the price holds above the neckline. Moreover, the Parabolic SAR flipped bullish, reinforcing upside momentum. As long as ETH holds above the neckline, a continuation remains likely.

Ethereum’s current momentum is supported by strong technical patterns and retail enthusiasm. However, on-chain metrics reveal substantial resistance and cautious whale behavior, paired with elevated exchange reserves and aggressive long positioning. If ETH successfully breaks through the $1,860 resistance zone, it may trigger a fresh leg up. Otherwise, failure to do so could result in volatility spikes and a sharp retracement.