Ethereum (ETH) has been facing a sustained decline throughout this month, remaining below the trend line for the past three weeks, causing concern among investors.
Despite the ongoing downward trend, Ethereum whales have emerged as saviors, injecting a ray of hope into the market.
Ethereum Whales Ride to the Rescue
Between the range of 100,000 to 1 million ETH holdings, mid-tier Ethereum whale addresses have been actively buying up the ETH that larger wallet holders have been offloading. This past weekend, these whales snapped up a whopping 1.1 million ETH, valued at around $3.5 billion in just one day. Their significant purchasing spree is aimed at stabilizing the embattled cryptocurrency.
This strategic move by mid-tier whales is effectively counterbalancing the selling pressure from bigger holders, showcasing their unwavering belief in Ethereum's potential for recovery. While this intervention has managed to avert immediate risks, the market remains watchful as traders wait to see if ETH can eventually break free from its current downward trajectory.
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Ethereum Whale Addresses. Source: Santiment
On a macro level, Ethereum's momentum is sending out mixed signals. The number of active wallet addresses saw a recent spike to 784,000, indicating heightened activity. However, this figure subsequently dropped sharply to 547,000, hinting at growing uncertainty among investors amid looming fears of a market downturn.
With a decline in active engagement, Ethereum’s path to recovery may encounter obstacles as market sentiment wavers. Investors seem poised to rejoin the market scene only after witnessing more stability and positive signals, further extending Ethereum's battle to regain upward momentum.
Ethereum Active Addresses. Source: IntoTheBlock
ETH Price Forecast: Navigating the Downtrend
Presently, Ethereum is trading at $3,200, consistently positioned beneath the downtrend line for three successive weeks. Despite facing bearish pressures, Ethereum manages to cling above the pivotal support level of $3,131, which remains a critical focal point for traders.
In the event that the downtrend persists and Ethereum breaches the $3,131 support, a price drop to $3,028 could be in the cards. Such a downfall may dampen hopes of recovery, leaving Ethereum exposed to market uncertainties that are on the rise.
Ethereum Price Analysis. Source: TradingView
Nonetheless, conquering the downtrend line and reestablishing $3,303 as support could potentially overturn the bearish narrative. This breakthrough necessitates strong backing from broader market indicators and renewed buying interest.
Achieving this milestone could propel Ethereum towards $3,500, offering a much-anticipated respite for investors.