Decoding Ethereum’s $4,400 test – Are THESE divergences a rally signal or a sell trap?

Key Points

1. Ethereum's price is currently at $4,206, facing resistance at $4,400, a level that has triggered reversals in the past.

2. Long-term on-chain signals are bullish, such as the declining all-exchange Supply Ratio (ESR), but Binance-specific data shows a rising ESR, indicating potential selling pressure.

3. The Relative Strength Index (RSI) is around 71, suggesting the market may be overbought, which could lead to profit-taking.

4. Futures traders' high leverage could accelerate bullish moves but also risks sharp liquidations if sentiment shifts.

5. Netflow data shows $245.57 million in ETH outflows from exchanges, but Binance ESR readings suggest some selling readiness remains.

6. Liquidation heatmaps highlight dense clusters between $4,300 and $4,400, where a failure could lead to a pullback to $4,000 support.

7. Despite overbought conditions, sustained exchange outflows and bullish on-chain data suggest a potential breakout above $4,400, possibly targeting $4,800.