Ethereum eyes mini breakout above $3K as Coinbase ETH outflows hit new record

Ethereum’s native token Ether (ETH) is poised for a mini bull run above $3,000 primarily due to a classic bullish reversal pattern on its shorter-timeframe chart, and a huge spike in ETH outflows from Coinbase.
ETH price forming falling wedge
ETH’s price has been forming a falling wedge pattern since late March 2022, which raises its prospects of undergoing a breakout move in May.
Falling wedges appear when the price trends lower inside a range defined by two descending, contracting trendlines.
As a rule of technical analysis, these wedges resolve after the price breaks out of their range to the upside and rises to a level at length equal to the maximum distance between the pattern’s upper and lower trendline when measured from the breakout point.

The maximum falling wedge height is around $395. Suppose ETH’s price closes above $2,850, the potential breakout point, accompanied by an increase in trading volume, its likelihood of rising by another $395 (toward $3,150) will be higher.
Coinbase ETH outflows hit all-time high
The interim upside outlook in the Ether market coincides with bullish on-chain data.
Notably, the number of ETH leaving Coinbase, the second-largest crypto exchange by volume, reached its highest level on May 3, data from CryptoQuant shows.

$ETH Coinbase Outflow hits an all-time-high

Live Chart https://t.co/PiITw2ZFf3 pic.twitter.com/tlFQndUhvQ

— CryptoQuant.com (@cryptoquant_com) May 4, 2022

Simultaneously, the ETH balance on all the crypto exchanges fell on May 3 to its lowest level since August 2018, according to one of Glassnode’s on-chain metrics.

Both indicators imply a surge in traders’ preference to hold Ethereum tokens over trading them for other assets.
They also coincide with a recent recovery in the upside sentiment of small Ether traders, namely an increase in the number of addresses that have a minimum balance of 0.1 ETH, 1 ETH and 10 ETH.
The Ethereum balances tick higher across the retail addresses as Ether’s price trends lower, indicating that traders have been buying ETH at local lows. That further supports the falling wedge’s bullish reversal setup.
Bearish long-term prospects
Ether’s likelihood of crossing the $3,000-level has not plucked it out of its prevailing, long-term bearish setup, however. 
As Cointelegraph covered earlier, ETH risks breaking below its ascending triangle range in Q2/2022 with its downside target sitting anywhere between $1,820 and around $2,670, depending on the breakout point.
Additional downside cues come from macro fronts, with Ethereum — like its top rival Bitcoin (BTC) — still holding its positive correlation with U.S. stocks in a sign that it would tail the traditional markets downward due to a common factor: a hawkish Federal Reserve. 
The U.S. central bank will release a policy statement on May 4 at 2 pm EST, followed by chairman Jerome Powell’s press conference at 2:30 pm EST. Officials have signaled that they would increase benchmark rates by 0.5% and approve plans to unwind their $9-trillion asset portfolio.
Related: Smart money is accumulating ETH even as traders warn of a drop to $2.4K
Researchers from Strategas Research Partners and Morgan Stanley anticipate that the U.S. benchmark index, the S&P 500, will decline by another 15-16% into 2022, reports Bloomberg. As a result of its consistent positive correlation, ETH also faces similar downside prospects this year.
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