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Ethereum’s price action has been one of the most disappointing features of 2025. The “king of altcoins” recently slipped below $2,000 for the first time in over a year. However, the latest on-chain data shows that the fortunes of the second-largest cryptocurrency might be about to change.

Here’s Why ETH Price Could Rebound From Current Lows

In a recent post on the X platform, popular YouTuber Crypto Rover revealed that significant amounts of Ethereum have been flowing out of cryptocurrency exchanges in the past few weeks. This on-chain observation is based on changes in the “Ethereum Exchange Reserve” metric, which tracks the total amount of ETH tokens on all centralized exchanges.

An increase in the value of the Exchange Reserve metric suggests that investors are moving their assets to wallets affiliated with these centralized platforms. This is usually considered a bearish signal for the asset, as selling is one of the main reasons investors send their coins to centralized exchanges.

On the other hand, when the metric’s value declines, it implies that more assets are flowing out of the centralized exchanges. This trend could signal fresh buying from investors or renewed interest in long-term holdings, which could be bullish for the asset price.

Interestingly, a separate on-chain revelation shows that Ethereum whales have been loading their bags in the past few days. Data from Santiment shows that whales holding between 1,000,000 and 10,000,000 tokens have purchased over 120,000 ETH tokens in the last 72 hours.

Source: @rovercrc on X

As shown in the CryptoQuant chart above, the Ethereum Exchange Reserve has fallen to a new all-time low of 18.3 million ETH tokens. This is a positive sign for the Ethereum price, as increased allocation to self-custodial wallets signals an elevated confidence in the asset’s long-term potential. 

Crypto Rover noted that if the Ethereum reserves on centralized exchanges continue to dwindle, the altcoin could experience a “supply shock” — or more fittingly a supply crunch. For context, a supply crunch refers to a decline in the amount of an asset available for purchase, leading to a jump in prices.

Ultimately, this fall in Ethereum supply on centralized exchanges could act as a significant catalyst for ETH’s price recovery.

Ethereum Price At A Glance

As of this writing, the price of Ethereum stands at around $1,990, reflecting a 0.6% increase in the past 24 hours.

The price of ETH on the daily timeframe | Source: ETHUSDT chart on TradingView

Featured image from iStock, chart from TradingView

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On-chain data shows the Ethereum Supply on Exchanges has seen a sharp decline recently, something that could be bullish for ETH’s price.

A Large Amount Of Ethereum Has Left Exchanges Recently

According to data from the on-chain analytics firm Santiment, the ETH Supply on Exchanges has fallen to its lowest point in almost 10 years. The “Supply on Exchanges” refers to an indicator that measures the total amount of Ethereum that’s currently sitting in the wallets of all centralized exchanges.

When the value of this metric observes an increase, it means the investors are depositing a net number of tokens of the asset into these platforms. One of the main reasons why traders transfer to exchanges is for selling-related purposes, and this kind of trend can have a bearish impact on the ETH price.

On the other hand, the indicator going down suggests a net amount of the asset’s supply is leaving the exchanges. Such a trend may be a sign that the investors are accumulating, which can naturally prove to be bullish for the coin.

Now, here is the chart shared by the analytics firm that shows the trend in the Ethereum Supply on Exchanges over the past year:

Looks like the value of the metric has witnessed a plunge in recent days | Source: Santiment on X

As displayed in the above graph, the Ethereum Supply on Exchanges has seen a massive drawdown recently, implying the investors have made a large amount of net withdrawals.

Compared to seven weeks ago, there is now 16.4% less ETH on exchanges. This sharp change has taken the indicator’s value to the lowest level since 2015, nearly a decade ago.

From the chart, it’s apparent that the timing of this latest withdrawal spree has coincided with a plunge in the cryptocurrency’s price. The same graph also shows the data related to the Bitcoin Supply on Exchanges and it would seem that, even though the number one digital asset has seen a decline of its own, the metric has still only continued to move sideways.

It’s possible that this is a sign the whales are making a stronger push to buy the dip for Ethereum, as compared to Bitcoin. However, the more likely explanation may lie in the rich ecosystem of DeFi and staking services that ETH hosts, which may be where this supply is heading off to in this period of market cooldown.

While Ethereum appears positive from an on-chain perspective, the same isn’t true for technical analysis. As analyst Ali Martinez has explained in an X post, the zoomed-out ETH chart may contain a grim picture for the asset.

The TA pattern that ETH has been trading inside for the last couple of years | Source: @ali_charts on X

As is visible in the chart, Ethereum has seemingly been consolidating inside a parallel channel for a while now. Recently, the asset has been on the way down and as the analyst has marked in the chart, a move to the lower level of the channel may be brewing for the coin.

ETH Price

At the time of writing, Ethereum is trading at around $1,960, down more than 3% over the last seven days.

The price of the coin seems to have been moving sideways recently | Source: ETHUSDT on TradingView

Featured image from Dall-E, Santiment.net, charts from TradingView.com

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Crypto analyst TradingShot has revealed that the Ethereum price has formed a megaphone bottom which has not been seen since 2020. The analyst revealed what happened the last time ETH formed this bottom, which provides a bullish outlook for the altcoin. 

Ethereum Price Forms Megaphone Bottom

In a TradingView post, TradingShot stated that the Ethereum price has formed a megaphone bottom like in March 2020. He noted that ETH is currently on the first week of a rebound after recording three consecutive red weeks when it could not break above the 1-week MA50. The analyst further remarked that ETH is taking on a lower lows trendline, which is technically the bottom of a 1-year megaphone since the March 11, 2024 high.

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TradingShot claimed that the market is no stranger to long-term megaphone consolidation periods like that. He stated that the Ethereum price eventually broke upward the last time it formed this megaphone between June 2019 and March 2020, which happened after the brutal COVID crash bearish leg that touched bottom. 

He noted that the March 2020 period is quite similar to the current bearish Ethereum price action since late December. The analyst then highlighted how perfectly aligned the Fibonacci retracement levels are. Based on this development, he predicted that the Ethereum price could at least test the 1.5 Fibonacci extension at $6,000 before this cycle tops at the end of the year. 

Crypto analyst Crypto Patel also raised the possibility of the Ethereum price rallying to as high as $8,000. He suggested that this parabolic move could happen in phase E of ETH’s bull run. He indicated that ETH could face significant resistance at around $4,050 to this price level. 

Bullish Fundamentals For ETH

Despite its underperformance, the Ethereum price has bullish fundamentals, which could spark a reversal to the upside and cause it to reach new highs. Crypto analyst Alternative Bull revealed that the exchange reserves of ETH are significantly declining. He remarked that this would lead to a limited supply which makes it only a matter of time before ETH goes parabolic. In line with this, the analyst affirmed that the altcoin is still in the early phases of its bull run. 

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Crypto analyst Ali Martinez has also revealed that whales are actively accumulating ETH, which is bullish for the Ethereum price. In an X post, he stated that 360,000 ETH were withdrawn from crypto exchanges in the last 48 hours, a development that could spark a supply shock. 

It is also worth mentioning that the Ethereum price could soon witness a supply shock through the ETH ETFs. Asset managers like Bitwise have filed with the US SEC to include staking in their funds. If approved, this could take more ETH out of circulation as some institutional investors opt to stake their ETH to receive yields. 

At the time of writing, the Ethereum price is trading at around $1,969, down almost 2% in the last 24 hours, according to data from CoinMarketCap.

Featured image from Unsplash, chart from Tradingview.com