Ethereum Stalls Near $2,550 Despite Institutional Buying, Low Exchange Reserves

Ethereum (ETH) is currently trading in a narrow range near $2,550, despite significant changes in its fundamentals. Institutional players are increasingly rotating into ETH, with Bit Digital, a Nasdaq-listed digital mining and infrastructure company, completely exiting its Bitcoin position to focus solely on Ethereum. The company acquired approximately $192.9 million in ETH after raising funds and selling its Bitcoin holdings, placing Bit Digital among the largest publicly held companies globally with the largest ETH holdings. This move indicates a positive sentiment towards ETH.

The amount of Ethereum held on centralized exchanges has dropped to just 18.9 million, the lowest level in recorded history. This decline in exchange reserves suggests that holders are moving ETH to self-custody or staking contracts, effectively removing it from active trading circulation. This is typically seen as a bullish sign, as it indicates declining sell-side liquidity. However, the lack of corresponding upside in price raises questions about whether buyers are already saturated or if some entities are quietly unloading into every rally.

ETH staking has also surged, with the total value staked now crossing 35.8 million ETH, the highest it’s ever been. This growth reflects deepening conviction in Ethereum’s Proof-of-Stake model, where stakers earn yield by locking up tokens to help secure the network. Despite this bullish supply dynamic, ETH remains trapped in a narrow band, trading in a horizontal chop zone between $2,515 and $2,590. This has held since early July, and ETH has failed to break convincingly above this band.

If we extrapolate the Fibonacci retracement from the swing low of $1,386 to the local high of $2,880 reached in June, multiple resistance zones emerge. The 0.236 Fib level at $2,527 aligns with ETH’s current stall point. A breakout above $2,736, the next key Fibonacci resistance, would signal renewed bullish strength. Right now, ETH is stuck just under that first resistance, lacking the conviction to push higher, even as supply dynamics flash green.

Ethereum’s fundamentals look better than ever: exchange reserves are at all-time lows, staking has never been higher, and institutional buyers are stepping up in size. But the price isn’t listening yet. If ETH breaks past the $2,736 barrier, that could validate the underlying bullish structure. Until then, Ethereum remains a coiled spring, with the only question being whether it’ll snap higher or fizzle sideways again. A dip under $2,309 could invalidate the optimistic trend.