Ethereum Price Plunges 4% as Large Investors and ETFs Sell Off Holdings
Ethereum (ETH) is experiencing a significant drop of nearly 9% on Tuesday as traditional investors and whales continue to offload their holdings, leading to eight consecutive days of negative flows for ETH ETFs. The situation has also sparked accusations against Ethereum co-founder Vitalik Buterin regarding his belief in ETH as a store of value.
ETH ETF investors have persistently been reducing their positions, with net outflows totaling $13.2 million on Monday, as reported by Farside Investors. This ongoing trend has seen a lack of inflows into new ETH ETFs, with notable outflows from entities like Fidelity, Franklin, and Grayscale.
Simultaneously, in the broader crypto market, several large holders of ETH, known as whales, have been observed depositing significant amounts of ETH on centralized exchanges. Notable transactions include a whale withdrawing and subsequently selling a substantial amount of ETH on Binance, resulting in a substantial loss.
The selling pressure has raised doubts within the crypto community regarding Vitalik Buterin’s commitment to ETH as a store of value. Despite these concerns, Buterin has publicly stated that approximately 90% of his net worth is held in ETH, refuting claims of disbelief in the asset.
In terms of technical analysis, Ethereum’s price has dipped below a crucial trendline, signaling a potential further decline. The current price action indicates a move towards the lower ascending trendline of a key triangle formation, suggesting a possible support level around $2,000 to $2,300 before a potential rebound.
Historical data shows similar price declines in ETH during specific periods, followed by subsequent rallies. If this pattern holds, ETH could aim to challenge its yearly high of $4,093 after navigating the upper descending trendline of the triangle.
Technical indicators such as the Relative Strength Index (RSI) and Stochastic Oscillator (Stoch) are currently signaling bearish momentum, with the Stoch indicating a potential buying opportunity if it enters the oversold region. The Awesome Oscillator (AO) is also showing signs of weakening bearish pressure, although the overall thesis may be invalidated if ETH breaches the lower ascending trendline.
In conclusion, Ethereum is facing significant selling pressure from investors and whales, prompting questions about its value proposition. Despite these challenges, the market remains dynamic, with potential opportunities for recovery and growth on the horizon.
