Ethereum’s Key Indicator Shifts to ‘Predominance’: Is an ETH Rally Incoming?

The Ethereum (ETH) ecosystem is flashing a rare signal that has historically preceded some of its most explosive bull runs. According to the latest data from blockchain analytics firm Swissblock, a key market cycle indicator has officially flipped to “predominance” (indicated by a blue signal). This shift suggests that Ethereum may finally be ready to step out of Bitcoin’s shadow and lead the next leg of the 2026 market cycle.

Despite a broader market “risk-off” sentiment triggered by recent geopolitical tensions and trade policy shifts, the on-chain metrics for Ethereum tell a story of massive internal strength and institutional positioning.

The “Predominance” Signal: What It Means

The “predominance” indicator tracks market leadership and capital rotation within the crypto ecosystem. When it flips to blue, it signals that Ethereum is beginning to outperform Bitcoin and the broader altcoin market in terms of relative momentum and liquidity absorption.

The last time this pattern emerged with such clarity was in Q2 2025, a period that saw ETH make substantial gains. Now, as of January 21, 2026, the signal has returned, bolstered by record-breaking fundamentals.

Record Staking: The Supply Shock Catalyst

One of the primary drivers behind this shift is the “staking craze.” Current data shows that Ethereum staking has reached a historic milestone:

• Staked Supply: Approximately 46.6% of the total ETH supply (77.85 million ETH) is now locked in the deposit contract.
• Institutional Lead: Treasury firm BitMine recently staked 1.7 million ETH ($5.56 billion), locking away over a third of its holdings.
• Net Inflows: The staking entry queue continues to outpace exits, effectively removing nearly half of Ethereum’s liquid circulation from the market.

This “supply shock” means that even a moderate increase in demand could lead to rapid price appreciation, as there is simply less “sell-side” liquidity available on exchanges.

Real-Time Market Data (Jan 21, 2026)

As of today, Ethereum is navigating a period of high-stakes volatility. While the on-chain signals are bullish, the price is currently testing a critical “pivot zone.”

The Technical Crossroads:

Ethereum is currently hovering near its EMA20 support of $3,162. Analysts at MEXC and Swissblock suggest that as long as ETH holds the $3,000–$3,100 support zone, the “predominance” signal remains valid. A break above the $3,350 resistance would likely flip the Supertrend indicator to “bullish,” potentially opening the door to a target of $4,000–$4,123 in the coming weeks.

Whale Activity: “Smart Money” is Buying the Dip

While retail sentiment has wavered due to global tariff uncertainties, “whales” are viewing the current price action as a discount.

Blockchain monitors recently detected Trend Research (led by Yilihua) transferring 70 million USDT to exchanges to acquire 24,555 ETH. This move highlights a growing conviction among large-scale players that the current macro-induced dip is a temporary hurdle before a major rally.

The Verdict: Is the Rally Incoming?

The divergence between bearish macro headlines and bullish on-chain “predominance” is striking. While short-term volatility is guaranteed—especially with the U.S. Coinbase Premium Index still struggling to flip positive—the structural tightening of ETH supply through staking suggests that the path of least resistance is upward.

As Vitalik Buterin recently noted, Ethereum in 2026 is acting as a “rebellion” against centralized infrastructure. If the predominance signal holds, that rebellion may soon be reflected in its market price.

Disclaimer: This post is a compilation of publicly available information. MEXC does not verify or guarantee the accuracy of third-party content. Readers should conduct their own research before making any investment or participation decisions.