Ethereum’s upward momentum has softened after reaching a key resistance zone. Recent shifts in price structure and on-chain flows suggest a change in market dynamics. The whale movements and exchange activity have become more prominent, influencing the current environment. As Ethereum price hovers around crucial support levels, price behavior and liquidity trends will be essential in determining the short-term direction.
Ethereum price stalls at key resistance after strong recovery rally
Ethereum’s rally from the $2,100 region pushed the price past the 0.618 and 0.5 Fibonacci retracement levels, indicating strong bullish momentum. However, the rally lost steam just below the $3,950 resistance area, with Ethereum trading around $3,503 at press time. The price is now holding on to the 0.236 level at $3,511.
The break below this level might result in a fall towards the support of $3,245 (0.382) or a downturn to the 0.5 level of $3,030. The RSI has also dropped to 54 indicating less buying power. Therefore, any short-term Ethereum price prediction now hinges on reclaiming $3,550 and breaking above $3,825.
The daily structure has changed to a period of consolidation where price is posing lower highs close to resistance. If bulls fail to step in soon, ETH could test the 0.5 or 0.618 retracement levels for support, sitting at $3,030 and $2,815, respectively.
However, provided that price reclaims $3,550 with volume, the retest of the resistance zone of $3,825 and $3950 will be likely. Until then, Ethereum is stuck between weakening upward momentum and the building downside pressure. This price region is critical for shaping a clearer long term Ethereum price forecast in either direction.
Whale selloffs and net-flows hint at deepening market anxiety
Whale activity has intensified significantly at press time, adding bearish sentiment to Ethereum’s current structure. According to Lookonchain, a whale sent 26,182 ETH, worth about 93.66 million dollars, to centralized exchanges.
Besides, BitMEX co-founder Arthur Hayes also sold 2,373 ETH worth around $8.32 million. A high profile offloading like this frequently causes more general market panic and may cause more selling particularly by retail traders who observe whale actions when seeking an indication of direction.
On-chain data from Coinglass shows Ethereum recorded $85.5 million in outflows on August 2nd, a steep decline from the $410 million recorded the previous day. Such a drastic reduction in outflow indicates that a lower number of investors are seeking ETH to place them in their custody. Rather, more ETH remains on exchanges, hence rising selling pressure.
Thus, the combination of weakening outflows and whale exchange deposits implies an increase in liquidation risk. Such a trend may bring Ethereum under more intense price pressure in the upcoming sessions unless it reverses with increased outflows and lower exchange balances.
In summary, Ethereum must defend the $3,500–$3,550 support range to avoid further downside. With whale selloffs spiking and outflows reducing, bulls face increasing resistance. Unless key levels are reclaimed soon, ETH may revisit lower Fib zones.
Frequently Asked Questions (FAQs)
Ethereum is showing signs of weakness after failing to break $3,950, now hovering around key support at $3,500.
Yes, Arthur Hayes sold 2,373 ETH worth $8.3M, joining other whales in increasing exchange supply and bearish pressure.
Lower outflows suggest less self-custody accumulation and more ETH remaining on exchanges, signaling potential selling.
Coingape Staff
CoinGape comprises an experienced team of native content writers and editors working round the clock to cover news globally and present news as a fact rather than an opinion. CoinGape writers and reporters contributed to this article.
Investment disclaimer: The content reflects the author’s personal views and current market conditions. Please conduct your own research before investing in cryptocurrencies, as neither the author nor the publication is responsible for any financial losses.
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