Ethereum (ETH) price has managed to hold above the $2,200 support as the cryptocurrency market slowdown intensified this week. On-chain signals highlight growing demand for whales on the Ethereum network, despite market-wide sell-offs. Following the approval of the Bitcoin Spot ETF, Ethereum appears to be next on the agenda of the Fund’s sponsors and the US Securities and Exchange Commission (SEC).
Ethereum (ETH) price is currently trading around $2,200, down 5% on the weekly period. However, a closer look at market trends shows that ETH has had a more resilient performance this week compared to the broader industry average.
On January 22, the cryptocurrency market suffered a major drop as Bitcoin (BTC) prices faltered below $40,000 for the first time in 50 days. By January 26, the global crypto market capitalization had dropped by 7%, with a valuation of $108.5 billion wiped out in the weekly timeframe.
However, by losing 5%, Ethereum price has maintained a relatively more resilient performance than the industry average between January 22 and 24.
Whales Continue Buying ETH Despite Market Crash
The Ethereum price has managed to keep losses below the 5% threshold this week, while Bitcoin and the global crypto market capitalization declined by as much as 7% respectively before seeing a slight rebound.
On-chain data trends suggest that increasing whale trading activity by corporate entities seeking to advance a potential approval of an ETH ETF has been instrumental to ETH’s resilient price performance this week.
On January 23, Ethereum’s whale transaction count surpassed 1,190. A closer look at the chart below shows that this was the highest recorded since the ETH price hit a 20-month high of $2,690 on January 11. January.
Despite the overall market slowdown this week, corporate entities continue to accumulate substantial volumes of ETH. This accumulation trend can be attributed to investors and fund sponsors positioning themselves to acquire Ethereum in anticipation of an impending ETH spot ETF decision.
In periods of market decline, an increase in whale transactions positively influences the price of a cryptocurrency in two significant ways. Firstly, it improves market liquidity, facilitating favorable trade execution for panic sellers. Secondly, it increases confidence among small retailers.
These factors have been instrumental as ETH struggles to maintain its position above the $2,200 support level amid widespread sell-offs in the market this week.
ETH Price Prediction: Can Ethereum Price Stay Above $2000?
As speculation surrounding the approval of Ethereum ETH proliferates, liquidity and investor confidence remain relatively high. This appears to have slowed Ethereum’s sales momentum this week, especially compared to the broader altcoin market. Coupled with the steady increase in whale transactions, Ethereum price is well positioned to defend the $2,000 level.
Money entry/exit price data from IntoTheBlock, which ranks all existing ETH holders based on their entry prices, also supports this view. It reveals that the largest group of ETH holders, comprising 8.3 million addresses, accumulated 46.5 million ETH at the highest price of $2,078.
In the event that the price of Ethereum falls towards $2,100, these holders could make quick purchases to avoid falling into net loss positions and safeguard their positions. This could potentially trigger an immediate rally in Ethereum price.
Ethereum bulls could counter the bearish pressure if they can reclaim the $2,500 level. However, given current market dynamics, this seems unlikely. As observed, a significant group of 3.7 million addresses obtained 7.1 million ETH at an average price of $2,400.
By Audy Castaneda
