Ethereum (CRYPTO:ETH) has experienced a sharp price decline, falling over 20% in the past month.
This downturn has led Ethereum whales—large holders of the cryptocurrency—to reduce their positions and trading activity.
The significant reduction in whale transactions indicates a cautious stance, which could suggest a prolonged bearish trend for ETH.
Data from IntoTheBlock shows that the daily count of large ETH transactions, valued between $1 million and $10 million, has decreased by 5% in the past 30 days.
Moreover, transactions above $10 million have dropped by 45% during the same period.
This decline in large transactions suggests that whales are hesitant to engage heavily in the current market, possibly due to expectations of further price declines.
The large holders’ netflow, which measures the difference between the amount of ETH bought and sold by significant players, has also decreased by 77%.
A negative netflow metric indicates that more ETH is being sold than bought, often a bearish signal.
This trend of reduced whale activity typically weakens market sentiment and could contribute to a continued downward trajectory for Ethereum’s price.
The bearish outlook is further supported by the Parabolic Stop and Reverse (SAR) indicator on Ethereum’s one-day chart.
According to TradingView, the indicator’s dots are positioned above ETH’s current price, signaling a downtrend.
The Moving Average Convergence Divergence (MACD) also shows bearish signs, with the MACD line nearing a crossover below the signal line.
This formation is often seen by traders as a signal to sell or take profits.
If selling pressure persists, Ethereum’s price could fall toward its August 5 low of $2,112.
However, if market sentiment shifts and buying activity increases, there is potential for the price to rally up to $2,867.
The next few days will be crucial in determining the direction ETH takes as traders closely monitor market indicators.
At the time of writing, the Ethereum price was $2,514.33.