Definition ∞ Ethereum exchange outflow refers to the movement of ETH tokens from centralized cryptocurrency exchanges to external wallets. This metric is often interpreted as a sign that holders intend to retain their assets for longer periods or deploy them in decentralized finance applications, rather than selling them immediately. A significant outflow suggests reduced selling pressure on exchanges and can indicate a bullish sentiment among investors. It removes ETH from readily tradable supply.
Context ∞ Ethereum exchange outflow is a key on-chain metric frequently analyzed in cryptocurrency news to gauge market sentiment for ETH. Large outflows often precede price increases, as fewer tokens are available for sale on exchanges. Conversely, inflows can signal impending selling pressure. Market observers closely monitor these movements to assess investor conviction and potential price direction.
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