Key Insights
- Ethereum has dropped nearly 10% from its recent high of $3,800 as selling pressure mounts.
- Whale netflow has plunged by 339%, which indicates that major holders are stepping back.
- Open interest in ETH futures on CME has also dropped, indicating lower institutional activity.
Ethereum news of bullish run to $4,000 now appears to have hit a wall. This comes after a strong July rally that saw the second-largest cryptocurrency climb more than 50%.
As of now, August has started with a significant trend change. ETH has fallen back to around $3,620 when writing, down nearly 10% from its recent high of $3,800.
Ethereum News: Whale and Institutional Interest in ETH Wanes
Ethereum news indicates that the Large-scale investors are pulling back, and it’s starting to show. For example, Ethereum’s open interest in futures on the Chicago Mercantile Exchange (CME) has dropped lately.
This metric has fallen to a five-day low of $6.2 billion, according to data from Glassnode. So why is this important? For starters, this matters because institutional investors often use CME’s futures.
Most of those investors who use it are seeking regulated exposure to ETH. When open interest declines, it tends to mean that investor appetite is waning.
Without that buying pressure, Ethereum’s price could struggle to stay afloat. In the same vein, the whales also appear to be stepping back. Data from IntoTheBlock shows that Ethereum’s large holders’ outflow has increased by nearly 200% over the past week.
Think of this metric as one that measures the selling behaviour of wallets with over 1% ETH supply. When it drops like this, it means that whales have hit pause on their accumulation.
Even worse, they could be offloading their holdings. This lack of conviction from big players is a further reason for the current market jitters.
Ethereum News of Price Sliding Toward Key Support Zones
Ethereum news suggests that the price action shows this sentiment weakness. Over the last 24 hours alone, ETH dropped from $3,800 to $3,518 before slightly recovering to $3,620.
During this drop, trading volume rose by 17%, which is typically a red flag. While trading volume surges can be an accumulation sign, they are also worrying when combined with a price dip.
According to data from Coinglass, Ethereum also faced one of the harshest liquidations ever. Ethereum news indicated that the ETH bulls are losing $233 million.
These liquidations beat Bitcoin’s $134 million nearly twice over. This is mainly because investors generally expected a price break above the $4,000 zone (which never materialised). If Ethereum falls below its $3,524 support level, it could dip further to around $3,314.
All hope isn’t lost, though. If demand returns and buying resumes, ETH could rebound to retest $3,859. It could also challenge the psychological resistance at $4,000 again.
Macro Factors Add Fuel to the Fire
Ethereum isn’t the only cryptocurrency facing pressure. Bitcoin has also dropped to $113,400. It is down from highs near $120,000. On the other hand, assets like XRP and Dogecoin have also declined.
More than $900 million in crypto liquidations have occurred in just 24 hours, according to Coinglass. With this, over $823 million of those are long positions. This is a clear sign that the millions are wiping out bullish bets across the market.
So why the sell-off? Several reasons for the ongoing market decline include the disappointing U.S. jobs report. That report led to the firing of the official who published it.
Meanwhile, the White House also announced sweeping new tariffs, worsening the trade tensions. Finally, the rising military pressure from reports that nuclear submarines were repositioned near Russian waters could have also created tension.
When combined, these developments likely created the bearish bomb that went off and pulled the markets underwater.
