Ethereum is under significant selling pressure after its recent attempt to recover from a multi-month low earlier this month. The cryptocurrency retraced over three weeks, retesting the crucial $2,819 threshold, which previously acted as a critical support level. However, this support has turned into resistance, leading to a rejection that signals a potential downside for ETH.
Bearish Market Structure Remains Intact
Ethereum’s range context remains unflattering from the shortest perspective. The coin formed a lower high and a lower low after hitting the $4k mark and retraced within the last three weeks in attempts to recover losses. Still, the weekend rejection at the $2,819 resistance area indicated that the bears were still in command.
The same goes for the current price action, which suggests a resumption of Ethereum’s bearish trend should the $2,819 level remain a cap on any further upside progression. Renewed selling pressure is evident around this resistance zone of $2,819, and any break above it has yet to be established.
This lack of strength has now put ETH at risk of additional downswings, with support zones at $2,509 and the monthly low of $2,132.
Whales Exit Positions Amid Losses
In the wake of Ethereum’s price drop, several large holders, commonly referred to as “whales,” have exited their positions at significant losses. Earlier today, as reported by Lookonchain, one whale sold 5,088 ETH, equivalent to $13.58 million, at a loss of $3.66 million.
Another whale sold 5,088 $ETH($13.58M) at a loss of $3.66M 6 hours ago!
This whale withdrew 5,088 $ETH($17.24M) from #Binance at $3,389 from Mar 28 to Apr 3.https://t.co/wecLHHWDDL pic.twitter.com/Y4hbRHmPZg
— Lookonchain (@lookonchain) August 27, 2024
This whale had previously withdrawn the same amount of ETH from Binance between March 28 and April 3, when the price was $3,389. The timing of this sale suggests that the whale’s initial intent might have been to hold the assets for potential gains. However, the market downturn led to a forced sale at a substantial loss.
Alongside other large single interactions, another whale deposited 8,825 ETH, translating to about 24 million US dollars, to the Binance exchange a few hours ago. This event saw a loss of 3.96 million dollars.
A whale deposited 8,825 $ETH($24M) to #Binance 25 minutes ago to sell, losing $3.96M!
This whale bought 8,825 $ETH($27.96M) at $3,169 from #Binance between Jul 27 and Aug 3 before the market crash.https://t.co/yA0mOcgOcC pic.twitter.com/nysVeaYaQ5
— Lookonchain (@lookonchain) August 26, 2024
Initially, the whale bought ETH between July 27 and August 3 for an average of $3,169 per ETH. However, the turbulent market caused by the recent crash brought about this massive loss, which explains the volatile nature of the cryptocurrency market.
Potential for a Major Sell-Off: Key Levels to Watch
The recent rejection at $2,819 has sparked worries that there could be the beginning of a huge sell-off, especially if Ethereum does not get support at the level of $2,469. If this support level is breached, the price may move towards $2,132 and even $2,000. At press time, the selling volume is very low; however, an increase in selling activities might aggravate the bearish move.
On the other hand, a recovery above the $2,819 resistance, which marks last month’s initial breakdown level, could provide some relief. Should Ethereum reclaim the $3,087 level, the bearish trend might reverse, setting the stage for a potential recovery. However, until such a recovery occurs, the outlook remains cautious.
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