On Thursday, the price of Ether (ETH) surged from $2,443 to almost $3,000 — a 13.55% climb, according to Coinbase data. The strong intraday upside move appeared a day after ETH’s 27.61% price crash. It thus raised hopes that the second-largest cryptocurrency by market capitalization would eventually recover in the days ahead.

But the prices declined nevertheless, leaving an impression that the upside recovery in the Ether market on Thursday was a mere “dead cat bounce” — a small, brief rebound in the price of a falling asset that acts as a bearish continuation pattern despite beginning like a bullish reversal one.

On Monday, the ETH/USD exchange rate painted a similar recovery candle. The pair jumped by nearly 20% to $2,474 in a rebound move that followed a 37% decline from Thursday’s closing rate. The strong bullish rebound suggested another dead cat bounce in the making, especially as on-chain indicators painted a bearish picture for Ether.

Ether exchange inflow forecasts trouble

Lex Moskovski, chief investment officer of Moscow-based banking service Moskovski Capital, alerted that the total Ether inflow across all crypto exchanges reached a yearly high of 199,947 ETH on Sunday.

In retrospect, many traders prefer to keep their tokens offline, away from their exchange’s custody. Therefore, they only transfer the digital assets to exchanges when they intend to either sell or exchange them for other tokens. Analytics portals track these capital flows to determine traders’ short-term market bias.

The record ETH inflow into all the crypto exchanges, said Moskovski, should make bulls careful about their upside bets.

“This is the biggest inflow we had this year,” he noted. “If it isn’t an internal [transaction], be careful.”

Bias conflict in the Ethereum market

Last week, traders sold off their cryptocurrency holdings on fears that Elon Musk’s Tesla would do the same.

The billionaire investor went into a Twitter spat with some of the leading crypto influencers in the week ending on Wednesday, eventually hinting that Tesla would dump its entire $1.5 billion worth of BTC holdings. He later refuted this, saying Tesla did not sell any Bitcoin.

China also fueled the crypto market’s sell-off further by reiterating its intention to crack down on digital currencies last week. Meanwhile, the United States Treasury Department also announced its plans to regulate larger cryptocurrency transactions, and Musk kept posting cryptic mixed signals.

Traders moved top altcoin markets in the range of 10%–30% in either direction based on such updates, pulling Ether into the swing trades alongside.

Ether price analysts also posted conflicted ETH/USD scenarios. A chart shared by pseudonymous market pundit the Crypto Cactus showed the pair at risk of crashing toward $1,700 should it slip below an interim support range around the $2,000-area.

“ETH is currently hovering around 2,200 USDT, with 2,400 USDT as a short-term resistance level,” detailed Robbie Liu, a researcher at OKEx crypto exchange. “Meanwhile, ETH/BTC has not seen a significant rebound.”

Data showed a spike in open interest, noting that investors are opening leveraged positions in the Ether derivatives market after witnessing a long squeeze of over $1.87 billion on Wednesday. The total number of outstanding futures contracts surged from $5.1 billion to $5.7 billion in the last 24 hours.

Derivative traders are majority short on ETH/USD, with their long/short ratio lurking at 0.98 as of noon UTC. Ether is currently trading roughly 44% below its record high of $4,384.

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