Today’s Ethereum price chart could suggest the formation of a bearish pattern called the “Double Top”. 100k ETH also flowed into Binance.
Ethereum Price Chart Shows Famous Bearish Formation “Double Top”
As explained in a CryptoQuant post, the cryptocurrency formed a bearish pattern on the price chart today, and around the same time Binance also noticed a net flow of around 100,000 ETH.
Here is an Ethereum chart that clearly shows the bearish pattern:
The ETH price chart today showed a bearish pattern | Source: CryptoQuant
As the graph above shows, Ethereum appears to have formed what is popularly known as the “Double Top” pattern. Historically, the formation of such peaks has been a negative signal.
However, a double high cannot be confirmed until the price falls below the support level marked by the break between the two peaks.
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The above chart was actually published by the analyst a few hours ago. A newer version of the diagram looks something like this:
ETH price continues to show volatility | Source: ETHUSD on TradingView
It looks like the price plummeted to $ 3.2,000 right after the two highs were formed, which is below the 3.3,000 support level.
In most cases, such a dip confirms that the formation is a bearish double top. Here, however, the price seems to be moving back to the support level.
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After a double top event, the support level becomes resistance, so the price stays below it for a while. It is possible that this is just a shoulder formation and that the bearish trend is still active.
Although the opposite could also be the case; the price could continue to rise instead. However, another negative signal also went off …
Around 100,000 ETH flow into Binance
Around the same time the two peaks formed, the netflow indicator for Ethereum showed that around 100,000 ETH had flowed into the Binance crypto exchange.
The “netflow” is a metric that shows the net amount of coins that are entering or leaving exchanges. It is calculated by simply taking the difference between the inflows and outflows.
If the indicator takes a negative value, it means that more ETH is moving outwards than inwards, while a positive value implies the opposite.
Here is a graph showing Ethereum netflow for all exchanges:
The ETH netflow increases | Source: CryptoQuant
The spike in the graph shows that around 100,000 ETH went into exchanges, and chain data confirms it got into the Binance crypto exchange.
Such a positive increase generally implies that investors are facing strong selling pressure and therefore are sending their coins to the exchanges for disposal.