The cryptocurrency market is feeling the heat of bear market momentum. Ethereum has had a tough week, and Justin Sun seems to be at the center of it. The Tron founder has been selling off his holdings of ETH, causing a stir in the market. In the past week, he has sold ETH worth $143 million. That's about half of his holdings. His actions have led to a significant drop in Ethereum's price. The community has many questions about him. Is he playing a game that others don't know about? There are more questions behind the issue of why Ethereum is dropping. Let's explore these factors.
Justin Sun: Sales and Staking
According to data from Spot on Chain, since November 10, he has deposited 108,919 ETH into HTX (formerly Huobi), worth approximately $400 million. These deposits mostly occurred when the price was near its high, averaging $3,674 per ETH.
Blockchain experts have noted that Justin Sun is also withdrawing a large amount of staked ETH. Specifically, he recently withdrew 42,904 ETH from Lido Finance, worth $139 million. There are suspicions that he may also transfer these funds to HTX. With such frequent activity, it's no surprise that Ethereum's price has been struggling.
Ethereum's price is under pressure
Ethereum's current trading price is $3,304. It has fallen 17% since recently dropping to $4,000. In the past 24 hours alone, it has dropped another 2.19%. Trading volume has also decreased by 8.57%.
Market sentiment is also not very good. Most traders seem to be bearish. Futures data shows that 54% of open positions are short positions, with a long-to-short ratio of 0.8495. But there is still a glimmer of hope—78% of Ethereum holders are in profit at the current price.
From a technical analysis perspective, Ethereum is approaching a key support level of $3,260. If it breaks below this level, the price could drop to $3,000, with the 200-day moving average potentially providing some stability. However, with the RSI at 39.28 (close to the oversold zone) and the ADX showing bearish momentum, the outlook is not optimistic.
What's next?
The biggest question is whether Ethereum can maintain above $3,260. If not, we might see it drop to $2,800, especially if whales like Justin Sun continue to sell off. Some analysts believe Ethereum is still in a 'safe zone' at this time. But others warn that low trading volume over the weekend and uncertainty in the stock market could lead to more volatility. This may have already eliminated your curiosity about why Ethereum is dropping. Currently, investors should remain cautious. Price fluctuations for Ethereum are nothing new, but the market's reaction to Justin Sun's actions has everyone paying closer attention.