Data agency CryptoOnchain released a set of data on January 2nd, which immediately woke up many ETH holders—Ethereum is experiencing a rare wave of massive capital inflows into exchanges, with net inflows reaching 24,500 ETH, hitting a new high since July last year.

Veteran players are well aware of what this scale of funds moving to exchanges signifies. When coins move from self-custody wallets to exchanges, there are usually only two possibilities: one is preparing to sell off, and the other is traders hedging or adjusting positions through derivatives. Currently, ETH price has been consolidating around $2,980 for a long time. Once the supply of ETH on exchanges increases, it becomes difficult to break through quickly, and the upward momentum is firmly suppressed.

Looking back at history, whenever such large-scale capital inflows into exchanges occur, subsequent market volatility tends to spike, often followed by a downward trend. In several similar signals last year, the results were invariably—either a rapid pullback or repeated oscillations downward, with few impressive follow-up trends.

Right now, ETH’s short-term momentum clearly leans toward the bearish side. Traders holding long positions should be more cautious, avoid being fooled by short-term fluctuations, and definitely not rely on luck to turn the situation around. With this level of selling pressure signals in front of us, the prudent approach is to control risk exposure, even if it means earning less from gains, to avoid being squeezed out at high levels.