Ethereum Is Flat, and Whales Selling: More Pain to Follow?
22 August 2024 - 5:00PM
NEWSBTC
Ethereum is struggling for momentum and remains under immense
selling pressure. As of writing, the second most valuable coin is
inside a narrow range, trending within the $2,100 on the lower end
and $2,800 on the upper end. The local resistance level could mark
the start of an impressive leg up, relieving the coin of the
current sell grip from early August. Ethereum Whales Selling
Although supporters are upbeat, expecting the coin to trend higher,
breaking above local liquidation lines in a buy trend continuation
formation, there are concerns. Looking at Ethereum price action,
the coin could post even more losses. Related Reading: XRP Alert:
Raoul Pal Advises Investors To Sell Now – Here’s Why One analyst,
citing on-chain developments, notes that Ethereum whales, or
addresses holding at least 10,000 ETH, have been actively selling
over the past month. Overall, their decision to sell could suggest
that these entities, who are often closely monitored, are not
confident about what lies ahead. Therefore, others could
follow suit by unloading their holdings, leading to a supply glut.
Considering market forces, an uptick in supply could negatively
impact prices, delaying the climb above the immediate roadblocks.
Massive Outflows From Spot ETH ETFs Beyond this, analysts are also
deflated by the current trends of spot Ethereum ETFs. In May,
prices shot higher when the United SEC unexpectedly fast-tracked
the approval of 19b-4 forms for applicants. The approval of the S-1
registration forms was also received positively, lifting prices
above the $3,000 mark. However, days after the product began
trading, there were more outflows, especially from Grayscale’s
ETHE. Concurrently, demand has been lower than expected. Since its
inception, over $247 million worth of ETH has been redeemed from
ETHE. Subsequently, prices have been struggling and moving further
away from March 2024 highs. Related Reading: Bitcoin Sees Surge in
Demand: Are We At The Final Phase of Consolidation? According to
Farside data, all spot Ethereum ETF issuers posted outflows of
around $6.5 million on August 20. This is mostly thanks to the
millions of dollars of redemption through ETHE. This has been a
consistent trend since August 15. It suggests that though the smart
contracts platform offers value, ETH’s immediate to medium-term
outlook is bearish. Accordingly, investors are choosing to move
their capital elsewhere. Feature image from DALLE, chart from
TradingView
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