As a new market standard surface, market sentiment may be extremely bearish.
Whales continue to sell, and if ETH declines, large derivatives traders will face significant liquidation losses.
The substantial supply and selling pressure before ETH threatens to elevate asset prices.
Recent market activities are not favorable for Ethereum [ETH]. In just the past week, it has dropped by 12.75%, and with increasingly bearish market sentiment, it could decline further.
Ambcrypto found that whale selling activity may not be the only catalyst for the market decline, as potential liquidation cascades could lead to demand pressure, causing ETH prices to drop.
Whales and potential liquidations could impact ETH
In the past 24 hours, the movement of traders' ETH controls a notable supply (also known as whales), which poses a potential sell-off.
During this period, Lookonchain reported that a whale holding 6,131 ETH worth $10.94 million transferred its assets to the centralized cryptocurrency exchange Binance.
Generally, when assets are transferred from private wallets to centralized wallets, it indicates an intention to sell. If this selling is in full swing, ETH could experience a significant price drop.
A potential downside for ETH is a contract of 125,603 ETH ($229 million) facing liquidation risks. If ETH reaches $1,787.75 and $1,701.54, the positions of two whales will be forcibly closed.
If this occurs, it may incite fear in the market, prompting derivatives traders to open more short positions while spot traders sell their ETH to avoid a downward spiral, further exacerbating demand compression.
Bearish sentiment will prevail
In the past 24 hours, trading activity among large traders has been significant, defined as those with total asset supply volumes between 0.1% to 1% of trading volume.
According to Intotheblock data, the trading value of these large traders is approximately $1.87 billion. This movement may be dominated by whale sellers, as the price of ETH fell by 1.85% during the same period.
Ambcrypto analyzed the market's possibilities rather than continuing its bearish trend. The analysis suggests that using funds calculated around price indicators will face significant resistance to moving upward.
Between $1,857.97 and $1,963.02, a total of 7.89 million ETH sell orders may exist across 5.82 million addresses at this level, which could limit upward movement, even forcing prices down.
Currently, the trading volume in the market continues to decline. The amount of ETH traded in the past 24 hours has been consistently decreasing, reflecting a lack of interest and willingness to trade the asset.
Currently, due to the trading of 614,000 ETH, the surge in token transfers (with prices and sentiment still bearish) has led to increased selling by traders, further amplifying the decline.
With more bullish datasets than bearish ones, ETH's downside risk remains higher than its chances of moving upward.
