Ethena (ENA) has seen a notable uptick of 17% recently, bouncing back from a rocky start to the year. This rise, though, follows significant losses earlier in 2025, compounded by a sizable token unlock event within the last 48 hours.
Despite this positive surge, Ethena still grapples with challenges in achieving a sustained breakout.
Facing Tough Times
The sentiment surrounding Ethena has been dominated by increased selling pressure, particularly in anticipation of the March 5 token unlock. Leading up to the event, about 149 million ENA tokens, valued at approximately $60 million, were liquidated in a 24-hour period.
Investors feared that the unlock, involving $833 million in tokens, would flood the market, disrupting the supply-demand equilibrium and pushing prices down.
Token unlocks often trigger price drops as the new tokens entering the market reduce the value of existing ones. This scenario unsettled many investors, prompting a surge in balances on exchanges. To prevent further losses, many chose to sell, intensifying the downward push on prices.
Challenges Ahead for Ethena
Moreover, Ethena's momentum has taken a hit due to actions by long-term holders (LTHs). The Mean Coin Age (MCA) indicator witnessed a significant decline, indicating that LTHs started offloading their positions even before the broader market took notice.
As stalwarts of any cryptocurrency, LTHs' selling behavior typically signals weak sentiment toward the asset.
The diminishing MCA showcases the waning confidence among these long-standing holders, further pressuring Ethena's price. When LTHs divest, it often hints at a broader market reluctance to hold, keeping prices on a downward trajectory over an extended period.
Ethena Price Outlook
Presently, Ethena trades at $0.404, slightly below the resistance level at $0.434. Despite the 17% surge, this uptick has not been potent enough to reverse the overarching downtrend. To break free from existing market conditions, ENA must breach the $0.434 barrier decisively and maintain higher levels.
If the bearish sentiment lingers and the aforementioned factors exacerbate, Ethena could dip towards the $0.326 support level. A breach below this support could lead to a further downside, potentially dropping to $0.259, signaling a bearish stance.
Nevertheless, a shift in investor sentiment and concerted accumulation efforts at these reduced prices might pave the way for a breakout. A successful breach of $0.434, followed by a solid foothold, could propel ENA towards $0.602. Such a scenario could invalidate the bearish outlook, offering a path to sustained recovery.