Ethereum (ETH) is currently under significant selling pressure, with recent data showing substantial outflows from Ethereum ETFs. This has coincided with a large sell-off by a prominent ETH whale, intensifying fears of a potential decline in ETH’s price.
Ethereum ETF Outflows Signal Caution
On Thursday, August 15, Ethereum ETFs experienced a notable net outflow of $39.2 million, reflecting investors’ diminishing confidence in ETH’s short-term prospects. Grayscale’s Ethereum Trust (ETHE) led the outflows with $42.5 million withdrawn. In contrast, Fidelity’s Ether ETF (FETH) saw a modest inflow of $2.54 million, according to Farside Investors. The total net asset value of spot Ethereum ETFs has now dropped to $7.16 billion, down significantly from over $10 billion when they were first launched. These outflows highlight a growing sense of caution among investors.
Whale Dumps ETH Amid Market Volatility
Further adding to the bearish sentiment, a major Ethereum whale recently offloaded a large portion of their holdings. On August 5, during a market dip, this whale purchased 2,978 ETH at an average price of $2,367, totaling about $7.05 million. However, the whale sold all of this ETH today at an average price of $2,586, securing a profit of $720,000.
In addition, Ether long liquidations reached $46.97 million, according to Coinglass. BlockTower Capital also sold $25 million worth of ETH, further fueling the sell-off. With Ethereum ETF outflows and these sell-offs, crypto analyst Ali Martinez pointed out that the TD Sequential indicator has flashed a sell signal on Ethereum’s hourly chart. He predicts a potential one to four candlestick correction in the short term.
Staking Inflows Hint at Further Price Drops
Adding to the bearish outlook, Crypto Quant analyst Amr Taha identified a pattern where large staking inflows are often followed by sharp price declines. This pattern was particularly evident at the end of July and mid-August, when large staking events coincided with Ethereum’s price volatility. As of the latest data, staking inflows have surpassed 16,000 ETH, which could signal more price turbulence ahead.
ETH Price Analysis and Potential Decline
Ethereum is currently trading between two critical levels: support at $2,060, marked by the 200-day Exponential Moving Average (EMA), and resistance at $2,817, defined by the 50-day EMA and the 50% Fibonacci retracement level. The direction in which Ethereum breaks out from this range will likely determine its short-term trend.
However, the threat of a “death cross” amid ongoing Ethereum ETF outflows could accelerate ETH’s price decline. The 20-day EMA is converging with the 50-day EMA on the weekly chart, a setup that has historically led to significant price drops. The last time this pattern appeared in May 2022, Ethereum’s price plummeted by 68%, from $2,885 to $887.
Adding to this bearish scenario, Ethereum’s Relative Strength Index (RSI) remains in a downtrend, currently at a neutral 42. This suggests Ethereum is not yet oversold, leaving room for further declines before any potential reversal.
