Why Ethena risks $0.13 drop despite 118M ENA whale buys

Ethena [ENA] has faced massive downside pressure, dropping to levels last witnessed during the market crash on the 10th of October. In fact, after being rejected at $0.25, the altcoin dipped to $0.17, reflecting intense downside pressure.

At press time, ENA traded at $0.17, down 20% on weekly charts, extending its month-long downtrend. With ENA trading at its recent low, investors, especially whales, have stepped in and bought the dip.

Ethena whales renew interest in ENA

In a major shift in whale behavior, ENA has recorded significant capital flows from the group. As such, whale demand has rebounded to early January levels, when ENA traded around $0.25. 

According to Nansen data, Top Holder Addresses bought 118 million ENA tokens worth $20 million. At the same time, these addresses offloaded 96 million ENA valued approxiamately $16.3 million. 

Source: Nansen

As a result, the Whale Balance Change held a positive region for two consecutive days, rising to 103 million ENA. With the balances remaining positive for consecutive days, it signalled increased accumulation by large holders. 

The Whale Buy Activity metric confirmed this shift in demand. Whale Buy Volume climbed to 37 million, while average buy volume reached 42 million at the time of writing, signaling strong investor interest.

Source: TradingView

Interestingly, on-chain monitors observed one such whale activity. According to Lookonchain, a whale withdrew 10 million ENA worth $1.75 million from Bybit and staked it.

This whale acquired these tokens and staked for yield as a defensive mechanism against the weak market structure. This shift suggests that whales now believe ENA has reached the bottom, and the downside is unlikely to continue. 

Retailers remain bearish

While whales have stepped in to defend Ethena from further downside, retail investors have continued to offload at every opportunity.

According to CoinGlass, Exchange Inflows have outpaced Outflows for three consecutive days. In fact, $46.38 million in ENA has flowed into exchanges, compared to $44.51 million in outflows.

Source: CoinGlass

At the time of writing, Spot Netflow climbed 123% to $1.87 million, a clear sign of aggressive spot selling. As a result, seller strength has remained relatively elevated.

In fact, the seller’s strength has remained between 54 and 67, validating seller dominance in the market. Often, higher selling pressure accelerates downside momentum, resulting in lower prices.

Battle for ENA heats up, which way?

Ethena has faced two conflicting forces between bulls and bears, leaving the market at a crossroads. While whales have turned bullish and resumed accumulating, retailers have held back and kept offloading.

As a result, the altcoin’s Relative Strength Index (RSI) fell deeper into bearish territory, at press time, almost crossing into oversold territory.

A drop in RSI to such extreme levels suggests that sellers have largely dominated the market and currently have total control.

Source: TradingView

At the same time, the altcoin has held below both short and long-term moving averages, 20,50,100 and 200, validating current bearishness.

This momentum setup signals the downside continuation potential despite renewed whale interest. If the pressure persists, ENA will breach the $0.17 support and fall towards $0.13.

Conversely, if whale demand positively affects power dynamics, Ethena will seek to flip the 20- and 50-EMA at $0.20 and $0.23, respectively.

Final Thoughts

• Ethena Whale bought 10 million ENA for $1.75 million and staked them.
• ENA dropped 20% on the weekly charts amid intense bearish pressure, with retail sellers dominating the market.