- ETH was down by more than 1.5% in the last seven days.
- If ETH initiates a bull rally, it might face resistance near $2,300 and $2,400.
The year 2024 began on a sweet note as Ethereum’s [ETH] value surged above $2,400. However, the king of altcoins witnessed a price correction, pushing its value under $2,300 once again.
While this happened, an interesting whale activity occured.
Ethereum’s chart turns red
After a comfortable beginning in 2024, ETH fell victim to a price correction on the 3rd of January. Because of the price correction, ETH’s value plummeted by more than 1.6% in the last seven days.
According to CoinMarketCap, at the time of writing, Ethereum was trading at $2,243.76 with a market capitalization of over $269 billion. Amidst this, Lookonchain recently posted a tweet highlighting an intriguing development.
It seems that #Paradigm deposited 6,500 $ETH($14.67M) into #Coinbase 2 hours ago.#Paradigm is very smart, accumulating $ETH in bear markets and selling $ETH in bull markets.https://t.co/TF3lEGhJvZ pic.twitter.com/XI5LV075iH
— Lookonchain (@lookonchain) January 6, 2024
As per the tweet, Paradigm deposited 6,500 ETH on Coinbase, which was worth more than $14.6 million. If historical data is to be considered, Paradigm has always bought ETH during bear markets and sold ETH in bull markets to earn profits.
Therefore, since Paradigm dumped ETH, does this mean a larger sell-off is on its way?
Are whales selling Ethereum?
AMBCrypto planned to check Ethereum’s whale activity to see how they were behaving. Notably, Ali, a popular crypto analyst, posted a tweet on the 6th of January, which revealed a promising development.
As per the tweet, in the past month, Ethereum whales bought over 410,000 ETH, worth nearly $1 billion. This showed that the whales were stockpiling ETH in hopes of a bull rally.
In the past month, #Ethereum whales bought over 410,000 $ETH, worth nearly $1 billion! pic.twitter.com/1gGguoEypx
— Ali (@ali_charts) January 6, 2024
Our analysis of Santiment’s data painted a similar picture. AMBCrypto found that whale activity around the token remained high, as evidenced by the spike in its Whale Transaction Count.
Its supply held by top addresses also increased last week, meaning that whales were accumulating more ETH until press time.
Source: Santiment
Not only the whales, but the market at large also seemed to have been buying Ethereum. The token’s Supply on Exchanges dropped last week, while its Supply outside of Exchanges increased.
Also, AMBCrypto’s analysis of CryptoQuant’s data showed that ETH’s net deposit on exchanges was low compared to the last seven-day average, clearly reflecting high buying pressure.
To top it off, ETH’s Coinbase Premium was in the green, which meant that buying sentiment was dominant among US investors at press time.
It was interesting to note that on the one hand, buying pressure on ETH was increasing, while on the other hand, the blockchain’s network activity declined.
AMBCrypto had earlier reported that BNB Chain [BNB] has surpassed Ethereum in terms of user activity over the past month. As per the data, only 1.28 million active addresses transacted on Ethereum, witnessing a 13% drop in user activity.
Source: CryptoQuant
Will high buying pressure initiate a bull rally?
While buying pressure increased and prices sank, ETH’s derivatives market metrics somewhat turned bullish. For example, ETH’s Open Interest dropped along with its price. Such instances indicate an increased chance of a trend reversal.
Its BitMEX Funding Rate also declined last week, and market sentiment around the token remained bearish, as shown by the dip in Ethereum’s Weighted Sentiment.
Source: Santiment
If we consider that ETH will soon begin a bull rally, it would still have quite a few barriers to overcome to skyrocket its price. To find that, AMBCrypto took a closer look at ETH’s liquidation heatmap.
Read Ethereum’s [ETH] Price Prediction 2023-24
Our analysis found that if a bull run is bound to happen, ETH would face a strong resistance level near the $2,300 mark. And if it goes above that level, then ETH’s would face its next barrier at $2,400.
The last time ETH’s price touched those levels, its liquidation spiked sharply.
Source: Hyblock Capital
