On-chain data indicates a potential turning point for both Bitcoin and Ethereum as the Coinbase Premium Index, a key metric tracking U.S. institutional demand, has flipped positive after a prolonged period of negative or neutral readings.
For Ethereum, data from CryptoQuant shows the Coinbase Premium Index has climbed back to zero after a period of negative readings, effectively neutralizing the prior discount. This level often acts as a critical inflection zone. The chart tracks the price difference of ETH on Coinbase compared to other major exchanges. A positive premium suggests stronger buying pressure from U.S.-based investors, while a negative premium indicates relative selling pressure. Historically, transitions when the premium flipped positive were often followed by upward price trends. Analysts note that because Coinbase is heavily used by U.S. institutions and ETFs, shifts in this premium are interpreted as a proxy for institutional appetite. Ethereum is now at a structural pivot; a sustained move above zero could signal renewed U.S. spot demand and the base for a recovery, while a rollback into negative territory may indicate buying conviction has not fully returned.
For Bitcoin, the Coinbase Premium has flipped positive for the first time in six weeks. This metric measures the price gap between Bitcoin on Coinbase's USD spot market and offshore exchanges. A positive flip typically reflects stronger U.S. demand and has historically aligned with ETF inflows and aggressive spot accumulation, signaling that real institutional-sized capital is stepping in rather than short-term derivatives traders.
Simultaneously, weekly technical analysis shows Bitcoin is in extreme oversold territory. Analysts, including Merlijn The Trader, caution this is not an automatic buy signal or a confirmed bottom, but rather a positioning warning. They note that when markets become heavily skewed in one direction, reversals can be violent, as seen during prior stress events like the COVID crash and the FTX collapse. The key distinction is timing—oversold conditions mean risk is increasingly asymmetric but do not guarantee an immediate reversal.
The market now sits at a crossroads. On one side, weekly positioning shows stretched downside pressure for Bitcoin. On the other, U.S. spot demand appears to be quietly returning for both major assets. If the Coinbase Premium continues strengthening while weekly conditions remain compressed, the setup becomes more constructive for a potential trend shift. However, if the renewed premium fades, derivatives-driven volatility could continue to dominate price action.
