Bearish trend grips Ethereum – But THIS group of whales refuse to sell

Key Takeaways

Are the whales buying or selling?

While some whales were selling, many whales of a particular size were HODLing, the supply distribution chart showed.

Is there enough demand to reverse the downtrend?

As things stand, no, the selling is more aggressive and likely to take prices lower. The $2.7k support zone could see a brief price bounce toward $3k in the coming weeks.

Ethereum fell 10.64% last week, from $3,095 on the 17th of November, to $2,765 by the end of the 21st of November. Since then, a small bounce of 2.88% has occurred.

Source: ETH/USDT on TradingView

As the price chart above illustrates, this bounce came from an important long-term demand zone. This area (cyan box) stretched from $2.4k to $2.7k.

It was important, technically, as it represented a consolidation phase in May and June.

It was also significant on-chain support, as some long-term ETH holder cohorts’ realized prices lay within this area.

Ethereum’s [ETH] market participants must remember that the trend remained overwhelmingly bearish. A trend reversal from here is not expected — the sentiment is too strongly bearish.

There is not enough demand to force a quick reversal to and beyond the $3k mark.

Ethereum whale cohort continues HODLing

Source: Santiment

The MVRV ratios for short-term and long-term holders were both below zero. This showed that, on average, holders were at a loss. These losses were the highest since June, another indication of the bearish trend’s strength.

Source: Santiment

The supply distribution chart showed that the 10k-100k ETH holding wallets had been accumulating in September and October. At the start of November, the number of wallets in this whale cohort dropped slightly.

Meanwhile, the 1-1,000 Ethereum holding wallets saw their numbers decline steadily since June. Only the smallest ETH holders have steadily increased in number.

Together, the evidence pointed toward whales buying ETH in recent weeks. It appeared that most of the selling pressure came from the smaller holder cohorts.

This idea was supported by data. A recent AMBCrypto report noted that whale buying activity was on the rise.

While smart money appeared to bet on a recovery, traders should remain cautious. The downtrend has not yet ended.

Investors looking to buy at the bottom are making a risky play. They should have clear invalidations for their bullish ideas. An ETH price drop below $2.4k would be this confirmation.