Following a chain reaction of sell orders caused by the analyst , Ethereum had the biggest decline among the leading cryptocurrencies by market capitalization.
Due to heavy losses experienced by long traders, Ethereum liquidations have surpassed $380 million in the last day.
The net flows of the Ethereum exchange have gone negative, suggesting that bulls may be purchasing the plunge.
With buyers making a comeback, Ethereum has a chance to recapture a crucial support level.
After suffering significant losses in the overall crypto market fall, Ethereum (ETH) is down 11% on Monday. Long traders were stung hard by the fall, but they are expected to make a return as a result of increased exchange outflows.
After a string of setbacks in the capital markets, particularly in the cryptocurrency sector, Ethereum and the whole crypto market have been in a wild decline over the last 24 hours:
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Sellers are reacting to news that Genesis Trading and Mt. Gox are repaying creditors.
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The greatest casualty among the top ten cryptocurrencies by market cap due to these headwinds was Ethereum. Some important market players are:
According to statistics from Lookonchain, Jump Crypto, the digital currency division of Jump Trading, is transferring 120,695 wstETH, which is about $410 million, to exchanges like as Binance and OKX. This action comes after speculation that Jump Trading is preparing to leave the cryptocurrency sector as a result of the CFTC's investigation into its crypto business.
With approximately $350 million in liquidations in the previous 24 hours, DeFi protocols were also severely impacted by Ethereum's drop. If Ethereum continues to go below $1,700, as several members of the crypto community have pointed out on X, it may cause a run on various DeFi protocols and depegs across a number of liquid staking tokens.
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According to CoinShares' statistics, a net outflow of $146 million occurred in Ethereum ETFs, with Grayscale Ethereum Trust (ETHE) continuing to attract more capital than other ETH ETFs.
Spot On Chain data shows that after ETH's 24% decrease earlier in the day, around $280 million was lost from Ethereum wallet addresses associated with Tron creator Justin Sun. At an average price of $3,051, these wallets allegedly amassed 377,590 ETH, which is equivalent to almost $1.15 billion.
An unknown buyer purchased 16,236 ETH using 37 million USDT at an average price of $2,279 after news broke of his alleged unrealized loss. This buyer is believed to share patterns of behavior with other wallets linked to Justin Sun, according to EmberCN.
The purchasing activity isn't limited to Justin Sun's wallet; according to CryptoQuant's statistics, there is a net exchange outflow of more than 100,000 ETH for ETH at the moment, suggesting that investors are increasingly buying the drop.
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Technical analysis of Ethereum (ETH): $2,800 support might be reclaimed.
With an 11% daily decline, Ethereum is now trading at about $2,500 on Monday. Ethereum saw its worst one-day decline since the crypto market crisis of May 2021, when prices fell from $3,500 to almost $1,700, before rebounding marginally. Earlier, the price of ETH had fallen 25%. A total of $381 million worth of ETH futures were liquidated due to the decrease; long liquidations constituted 82% of the total, while short liquidations made up 18%.
Due to the selling pressure caused by the aforementioned headwinds, ETH was unable to retain the crucial support spanning from $2,852 to $2,803. It seems like ETH prices are retreating after approaching the bottom of a rectangle, which is located just below the junction of the 200-day simple moving average.
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Because 1.23 million addresses bought almost 50 million ETH at $2,340, according to IntoTheBlock's statistics, this might be because of the significant support around this price.
At the same time, the ETH RSI has fallen to 31.34, which is quite close to the oversold area and much lower than its moving average. When the RSI for ETH was last this close in September 2023, it abruptly turned around, setting off a brief upswing.
ETH has the potential to resume its ascent and regain the $2,803 support level should the general market pessimism subside. If Ethereum prices continue to fall, the $2,000 psychological threshold may provide some support. If prices fell below this level, the argument would be rendered useless.