Today, the cryptocurrency market experienced a significant amount of selling, leading to a sharp decline in the price of Bitcoin as it fell below crucial support levels and approached a low of $59,000. This drop was initiated by an announcement from Mt. Gox regarding the commencement of repayments, sparking concerns of further selling pressure. Concurrently, Ethereum also saw a substantial drop from its peak of $3,500, resulting in a flurry of sell-offs. Moreover, current on-chain data indicates a negative trajectory for Ethereum, potentially hindering its prompt recovery.
Ethereum’s Whale Transaction Declines
The week began with a notable downturn in the crypto market, with BTC slipping below $59K. Data from Coinglass revealed total liquidations surpassing $350 million within the last 24 hours. Particularly, ETH witnessed liquidations nearing $80 million, while long position holders faced liquidations exceeding $67 million.
Whales, known for their significant impact on asset prices due to their substantial holdings, are exhibiting negative behavior in the ETH market. Notably, addresses holding between 100,000 and 1 million ETH have offloaded approximately 700 million ETH in the past two weeks.
This significant sell-off, amounting to around $2.32 billion, has reduced their collective holdings to 20.26 million ETH. Given that whales typically hold onto their positions even during bearish periods, this large-scale selling activity is a cause for concern.
Data from IntoTheBlock indicates a decline in large transaction volumes for Ethereum this week, with the metric dropping from a peak of $6.7 billion to a low of $3.4 billion. This decrease has weakened buying volatility for ETH throughout the week.
Retail investor selling has also increased. Analysis suggests that approximately 25% of ETH users are currently in a profitable position, likely prompting transactions to secure these gains. Typically, selling activity is low when under 25% are profitable, but with this threshold surpassed, investors may be looking to lock in profits amidst potential price declines.
What’s Next For ETH Price?
The uncertainty surrounding Ether was resolved with a downward movement as it breached the 50-day SMA at $3,420. ETH price tested the patience of buyers around the $3,200 level; however, bears failed to drive the price lower. This created an opportunity for a rebound in ETH price. Currently, ETH price is trading at $3,300, reflecting a decline of over 4.7% in the last 24 hours.
The declining 20-day EMA at $3,372 and an RSI near 28 signal strong bearish control. Sellers are likely to aim for a push towards the psychological level of $3,000 and potentially lower to $2,850.
Buyers are anticipated to strongly intervene between $3,000 and $2,850. A break and close above the 20-day EMA would suggest a weakening of bearish pressure, potentially triggering an upward movement in the ETH/USDT pair towards $3,545.
