Ethereum Price Consolidates Amid Strong Network Activity Institutional Inflows

Ethereum's price has been experiencing a period of consolidation, moving within a tight range as the market takes a breather. This range-bound movement suggests that the token is undergoing extreme compression, with neither buyers nor sellers gaining significant ground. Despite the lack of dramatic price movements, Ethereum has shown strength by maintaining its position above key levels, indicating that the market may be preparing for a more substantial move.

In July, Ethereum's network activity has remained robust, with a slight pullback in daily transactions and moderate gas usage. The network recorded about 1.23 million transactions in the first few days of the month, reflecting an 8% year-over-year increase in sustained network usage. Gas usage sat at approximately 50.66%, slightly above last year's levels but below typical longer-term averages. Additionally, large holders have been withdrawing from exchanges, with a significant whale withdrawing around 7000 ETH from Binance, including 1900 ETH recently. This withdrawal has contributed to a declining exchange reserve, which is nearly 18.96 million ETH. Institutional inflows into Ethereum-focused investment products have also accelerated, with a $226 million inflow last week, marking the 11th straight week of positive inflows and signaling strong institutional sentiment.

As Ethereum's price consolidates within a narrow range, the token appears to be preparing for a significant price action in the long term. The weekly chart hints at a potential breakout, with the weekly Ichimoku cloud about to undergo a bullish crossover. The weekly DMI levels have converged, suggesting a huge volatility incoming that may change the direction of the persisting trend. After a strong recovery, the ETH price has reached a threshold, and a breakout from this range could elevate the levels above $3000. This potential breakout could mark the beginning of a fresh bullish spell for Ethereum, reaching levels never seen before.

Meanwhile, Ethereum has been outperforming Bitcoin in the third quarter, suggesting that altcoins could be on the rise. This outperformance, combined with the strong fundamental and on-chain updates, indicates that Ethereum may be poised for a significant price movement in the coming weeks. However, it remains to be seen whether Ethereum will break above $2800 this week or continue to consolidate within its current range.