The Ethereum whale instilled fear among those involved after releasing approximately 19,000 ETH. However, a more severe pullback is still possible.
Ethereum (ETH) experienced a major shock as a prominent ICO Ethereum whale sold 19,000 tokens (over $47.5 million) in just two days, sending ripples through the market.
The expected downward pressure from whale activity did not materialize, even though October started with consecutive red candlesticks on the daily chart and ETH failed to reach $2.7,000.
Instead, ETH rose about 2% from the previous day, attracting the attention of AMBCrypto.
Ethereum whale activity suggests market top
The chart below reveals an interesting development. A large spike in net outflows is usually a sign of aggressive buying and indicates traders’ confidence in a potential price correction.
For the past three days, ETH net flows have remained negative, suggesting widespread optimism.
Source: CryptoQuant
However, this optimism stands in stark contrast to recent Ethereum whale activity that suggests $260,000 (the price at which the decline occurred) is a potential market high.
If so, a retracement from ETH’s current price of $2.37,000 to its previous rejection level of $2.23,000 could continue.
Additionally, there is another side to this chart. Traders who bought ETH over the past three days, which opened at $260,000 in hopes of a bullish cycle, are now finding themselves with a net loss.
Source: Into the Block
This situation highlights the impact of recent Ethereum whale activity, which has put many investors at a disadvantage.
As a result, confidence wanes in the face of significant selling pressure, and the widespread losses among traders could further reduce the chances of a market reversal.
Fear can cause panic selling
Clearly, the Ethereum whales had a significant impact on ETH price movements. This is also impacting investor confidence in the future recovery, as the chart below shows.
Ethereum’s exchange reserves suddenly surged, with approximately 18.7 million ETH deposited on the exchange.
Source: CryptoQuant
This increase is a direct reflection of the fear that gripped those involved following the Ethereum whale’s sale of 19,000 ETH.
Generally, the best “push” buying opportunities require extreme fear. The small 2% increase mentioned above, despite the significant decline, may be an indication of just that.
According to AMBCrypto, more aggressive acquisitions could absorb selling pressure from Ethereum whales and reverse the current trend. If that happens, the bottom price of the market will be determined, and buyers seeking lower prices may gather.
Read Ethereum (ETH) price prediction for 2024-2025
But for this reversal to work, extreme fear must exist among investors. Without that fear, the chances of lasting recovery are low.
Therefore, in addition to the impact of the Ethereum whale, ETH could face further decline before a significant rally occurs.
Next: Dogecoin whale buys up $1 billion Doge: Is it enough to spark a rally?
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