RSI Divergence and Historical Examples

The classic RSI divergence between February 15 and March 1 allowed Ethereum to rise 15% and reach a peak near $2,200. The current movement follows a similar technical pattern. However, on-chain accumulation and exchange outflows that supported the previous rise are not as strong this time.

Exchange Flows: Rising Inflows and Selling Pressure

On March 9, the exchange net position change turned positive, with inflows reaching 146,709 ETH. Rising inflows typically indicate that investors are moving coins onto exchanges, increasing the likelihood of selling pressure. Facing selling pressure immediately after this divergence is not a positive sign for bullish hopes.

Whale behavior has also shifted. Large investors reduced their holdings from 113.70M ETH on March 7 to approximately 113.61M ETH on March 10, a decrease of around 90,000 ETH. This combination shows that the current recovery lacks the accumulation support that fueled the previous 15% ETH price rise.

On-Chain Cost Data and Resistance Levels

URPD data shows that over 4% of Ethereum’s supply is concentrated between $2,030 and $2,180. These areas act as resistance where investors may sell near their cost basis.

• $2,130: The first critical level that must be breached for a strong move.

• $2,200: Psychological resistance that capped the March rise; 8-hour close here is important.

• $2,270: Next major supply cluster; must be overcome for sustained bullish momentum.

A drop below $2,000 could weaken the recovery thesis, and a further decline toward $1,910 would reinforce the overall downtrend. Ethereum must first surpass $2,130 to maintain bullish hopes. The next key hurdle is the psychological $2,200 level, which limited the previous March rise. A confirmed 8-hour close above $2,200 would indicate absorption of nearby supply clusters and open the path toward $2,270.

Short-Term Perspective

The current recovery appears technically valid. However, on-chain data, whale activity, and dense supply clusters suggest that the rally may face stronger resistance than the previous attempt. Can Ethereum overcome these barriers, or will selling pressure return?

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Bearish Signals and RSI Divergence 

RSI shows a bearish divergence in Bitcoin Dominance. While BTC.D rises, RSI loses momentum. A similar situation occurred in 2021. RSI divergence predicted BTC.D’s collapse, triggering an altcoin season. Analysts suggest that if the trend breaks, capital could flow into altcoins. History indicates the market is ready for a shift. Ethereum’s market dominance has fallen from a 2022 peak of 22.27% to 7.5%. 

Most altcoins have lost significant value from their 2024 highs. For example, Ripple (XRP) is down 37%, Cardano (ADA) 50%, Solana (SOL) 51%, and Tron (TRX) 45%. 

Analysts’ Altcoin Season Prediction 

Ijaz Awan noted that BTC.D is approaching the 71.38%-73.06% resistance zone. This zone marked peaks in 2017, 2019, and 2021. Karman Asghar sees a double-top formation in 2025. Additionally, Asghar demonstrated similarities between the 2021 and 2025 charts. This strengthens expectations for an altcoin season. High BTC.D indicates Bitcoin’s market dominance, while low BTC.D signals altcoin rallies. Furthermore, the total altcoin market cap (Total2) and other coins’ dominance (Others.D) charts show positive RSI divergence and trend reversal signals, reinforcing the likelihood of an altcoin recovery. 

New Opportunities in the Market 

BTC.D’s peak could create opportunities for altcoins. Meanwhile, analysts await a trend break. If capital shifts to altcoins, 2025 could be eventful. BTC.D’s movements will shape the path for altcoins. 

***NOT INVESTMENT ADVICE*** 

The crypto market carries high risk; please conduct your own research before investing. 

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