Ethereum’s price is under notable pressure as major market players offload significant volumes, causing concerns among investors and traders. After peaking near $4,900 in this cycle, Ethereum (ETH) has been locked in a downtrend with only brief moments of recovery. As of now, ETH trades around $2,856, reflecting a 2.36% daily drop and a 10% decline over the past week.
Whale Activity Signals Profit-Taking
On-chain data has unveiled key insights into the behavior of Ethereum whales. For instance, a prominent whale moved 7,654 ETH—worth approximately $21.62 million—into Binance, locking in a profit of around $4 million. Earlier, the same whale had deposited 10,169 ETH into the exchange, realizing an additional $11.36 million gain.
In total, 17,823 ETH (valued at roughly $51.4 million) were sold off by this whale. Blockchain analysis revealed that the whale originally withdrew and staked over 19,500 ETH, earning 763.58 ETH in staking rewards. The rapid profit-taking and subsequent selling align with typical trends where large holders exit during extended downtrends, signaling fears of further downside risks.
Institutional Investors Add to Selling Pressure
It isn’t just individual whales exiting the market; institutions have also been reducing their exposure to Ethereum. According to data from SoSoValue, Ethereum Spot ETFs experienced net outflows for five consecutive sessions, amounting to a staggering $533.25 million. Notably, a single day (December 17th) saw outflows spike to -$22.43 million. This mass sell-off caused Ethereum Spot ETF assets under management to drop from $21 billion to $17 billion within five days, marking a $4 billion decrease.
The sustained outflows suggest a bearish stance from institutions, amplifying the bearish tone in Ethereum’s price movements.
Technical Analysis Highlights Bearish Sentiment
Momentum indicators underline the prevailing downside pressure on Ethereum. The Stochastic Momentum Index, for instance, has dipped into oversold territory. The coin hovers just above the 0.618 Fibonacci Retracement level at $2,807. If this crucial support level fails to hold, ETH might plunge further toward the 0.786 retracement zone around $2,633.
Potential Relief on the Horizon?
However, recent exchange activity hints at possible short-term relief. Data from CryptoQuant shows that exchange netflows turned sharply negative, falling to -47,100 ETH compared to the prior day’s +46,000 ETH. The decrease in sell-side pressure could indicate growing demand—if buyers successfully defend the $2,807 support zone, Ethereum may attempt a rally toward its next resistance level at $2,929 and possibly $3,200.
Protect Your Investments
Given the current market volatility, it is crucial for both retail and institutional investors to stay updated and make informed decisions. For those looking to safeguard their investments against market fluctuations, exploring cold storage wallets such as Ledger Nano X could provide enhanced security for Ethereum and other cryptocurrency holdings.
Stay tuned for further updates on Ethereum and the broader cryptocurrency market as we continue to monitor these evolving trends.
