Ethereum (ETH) Price Targets $3,000 Amid Lack of Conviction

Ethereum (ETH) price declining might be speculated to be the result of a bad start to the launch of spot Ethereum ETFs.

However, the truth of the situation is slightly different and has more to do with what ETH holders are doing than the institutions.

Ethereum Investors Choose to Sell

Ethereum’s price is currently trading at $3,165, bearing the brunt of a bearish move from ETH holders. The first sign of the same is the whales offloading their holdings.

This move is not recent, as their selling has been ongoing for the last two weeks. During this period, they have managed to dump more than 840,000 ETH worth a little over $2.65 billion. The addresses that conducted these transactions hold between 10,000 and 100,000 ETH and tend to impact the price.

Historically, their buying has led to a rise, while their selling has resulted in price declines. This is what happened this time around as well since these skeptic whales opted to book profits before the launch of ETH ETFs.

This was likely done to circumvent the uncertainty of the market’s reaction to the launch .

However, this sentiment was not of whales alone and was shared by the retail investors as well. This is visible in the massive spike in the realized profits metric. This was the largest bout of selling for profit noted in more than a month and a half.

Interestingly, this $747 million worth of profit-taking occurred exactly the day before the launch of ETH ETFs. This shows that while retail investors lacked foresight of what was next, they still chose to secure their gains.

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Naturally, this impacted the Ethereum’s price drastically. Discussing the same, Markus Thielen, Founder CEO at 10x Research Ltd noted,

“As we showed on Tuesday, the stochastics indicator was at the top of the range, suggesting that a top could be in the making. A reading above 90% is frequently associated with a correction, while a level below 15% has indicated lows to buy. With a current reading of 87% (from 92%), Ethereum appears on its way to a lower level.

The view remains to buy Bitcoin when bullish and short Ethereum when bearish. Considering the recent rally and the potential overhang from Mt. Gox, the US earnings season, and the weak seasonals for August and September, it might make sense to press the Ethereum short a bit longer.”

ETH Price Prediction: Redemption Ahead

Ethereum’s price is currently above the 23.6% Fibonacci Retracement line marked at $3,118. If the aforementioned conditions continue to be as intense as they are, ETH could be looking at a drawdown of $3,000.

As is the inflows into the ETH ETFs have not been particularly impressive. On top of this, the Grayscale Ethereum Trust (ETHE), akin to Grayscale Bitcoin Trust (GBTC), has noted over $800 million worth of outflows since its launch.

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However, the 23.6% Fib line is also known as the bear market support floor and has been tested previously. Thus, a bounce back from this level could prevent further decline, potentially triggering recovery to send ETH to $3,304.