Ethereum (ETH) experienced a sharp 15% drop last week, leading to significant losses for investors.
The drop has increased selling pressure as holders appear more inclined to lock in profits rather than hold on to their assets. This trend could exacerbate ETH’s downward price trajectory.
Ethereum Losses Mount
The recent price drop has seen the supply of ETH at a loss increase by 7 million coins in just one week, from 2.7 million ETH to 9.7 million. That supply is currently valued at over $23 billion, highlighting the scale of the losses.
Such a significant increase in unrealized losses marks the largest increase in more than five months, heightening concerns about heightened selling activity. As losses mount, investor behavior indicates a shift toward liquidating holdings rather than waiting for a recovery.
This growing sell-off has the potential to push prices lower, putting Ethereum at risk of entering a prolonged bearish phase if market conditions do not improve.
Ethereum supply at a loss. Source: Glassnode
Ethereum’s macro momentum is showing signs of potential weakness. Active addresses in profitability currently account for over 28% of network participants. Historically, when profitability exceeds 25%, the probability of profit-taking increases significantly, often leading to further price drops.
This level of profitable addresses signals that more investors may sell to lock in gains, adding to the existing selling pressure. If this trend continues, ETH may struggle to maintain its current levels, leading to a steeper price drop.
Profitable Ethereum Addresses. Source: IntoTheBlock
Price prediction
ETH price has fallen to $3,377 following its 15% weekly drop. This is the second time in a month that the asset has failed to establish $4,000 as a support level, reinforcing the bearish sentiment. The inability to hold this critical level leaves the cryptocurrency vulnerable to further corrections.
However, if the current downtrend continues and selling pressure intensifies, ETH risks losing the $3,327 support level. A break below this point could take the price below $3,000, signaling a significant bearish phase.
Ethereum chart. Source: TradingView
However, Ethereum faces a barrier at $3,524. However, turning this resistance into support could trigger a recovery, pushing the price to $3,721. Such a move would negate concerns of further losses, providing a much-needed boost to investor confidence and market sentiment.
The article Ethereum (ETH): Billions in Losses Spark Fears of Mass Selloff appeared first on BeInCrypto Brasil.
