Ethereum (ETH) price targets $3,000
The decline in the price of Ethereum (ETH) may be attributed to a poor start to the launch of Ethereum spot ETFs.
However, the reality of the situation is a little different and has more to do with what Ethereum holders are doing than institutions.
Ethereum investors choose to sell
Ethereum price is currently trading at $3,165, bearing the consequences of a downward movement from ETH holders. The first sign of this is the whales getting rid of their belongings.
This move is not recent, as they have been selling off over the past two weeks. During this period, they managed to dispose of more than 840,000 ETH worth just over $2.65 billion. The addresses that made these transactions hold between 10,000 and 100,000 ETH and tend to influence the price.
Historically, buying them has led to a rise, while selling them has led to a decline in prices. This is what happened this time as well, as these skeptical whales chose to take profits before launching their Ethereum ETFs.
This was likely done to avoid uncertainty about the market's reaction at all.
However, this sentiment was not only from whales, retail investors also shared it. This is evident in the significant increase in the profits generated metric. This was the largest profit-making selling wave recorded in more than a month and a half.
Interestingly, the $747 million profit taking occurred exactly the day before the launch of the Ethereum ETF. This shows that while retail investors lacked a vision of what would happen next, they chose to lock in their gains.
Naturally, this greatly affected the price of Ethereum. In this context, Markus Thelen, founder and CEO of 10x Research Ltd, noted:
“As we showed on Tuesday, the Stochastic indicator was at the top of its range, indicating that a top may be in the making. A reading above 90% is often associated with a correction, while a level below 15% indicates buying lows. With a current reading of 87% (from 92%), Ethereum appears to be on its way to a lower level.
The view remains to buy Bitcoin when it is bullish and sell Ethereum when it is bearish. Given the recent rise and potential burden from Mt. Gox, the US earnings season and the weak seasons of August and September, it may make sense to press the Ethereum short for a little longer.”
ETH Price Forecast: Redemption is Coming
Ethereum price is currently above the 23.6% Fibonacci retracement line set at $3,118. If the aforementioned conditions continue to be as severe, ETH could look at a drop to $3,000.
Inflows into Ethereum ETFs have also not been particularly impressive. On top of this, it has been noted that Grayscale's Ethereum Trust (ETHE), similar to Grayscale's Bitcoin Trust (GBTC), has seen outflows of over $800 million since its launch.
However, the 23.6% Fibonacci line is also known as a bear market support floor and has been tested previously. Therefore, a bounce from this level may prevent further decline, which could lead to a recovery that sends ETH to $3,304.
