Bitcoin and Ethereum Signal Possible Continued Rally

Crypto analysts are pointing to several signals that could indicate a continuation of the recent rally in Bitcoin and Ethereum prices. According to Santiment, the exchange supply of Ethereum has shrunk by 73% from its peak in June 2020, with around 6.06 million ETH currently held on exchanges. This reduction in easily sellable supply may make it easier for the price to rise with less new demand required.

Santiment also notes that large Bitcoin holders have been reducing their reserves over the past three weeks, while retail investors have started accumulating the asset again after a period of selling. Historically, this combination has often been observed near locally overheated tops, but analysts caution that it does not guarantee a price drop.

CryptoQuant's LTH SOPR metric has also risen above 1, indicating a shift from a bearish phase to a neutral state and the start of an uptrend. Analyst Darkfost notes that short-term Bitcoin holders have been holding profits for almost a month, which could be a sign of a shift in market structure.