Amid industry-wide headwinds, Ethereum (ETH) bulls managed to defend the $1,600 support territory this week. With recent media reports mooting a potential Ethereum Futures ETF approval, how will ETH price react in the short term?
Ethereum’s (ETH) price instantly rebounded towards $1,700 after a Bloomberg report citing anonymous sources stated that the US SEC was set to greenlight several ETH Futures ETF applications. Applications from Wall Street bigwigs like ProShares, Volatility Shares, Bitwise, and Roundhill were among those identified in the report.
However, critical on-chain analysis examines how ETH prices will react in the coming weeks.
Price-Savvy Whales are Still Dumping ETH on the Market
On-chain data shows that Ethereum whales have not bought into the recent bullish Bloomberg report. In fact, they have continued to dump their holdings despite the mild price bounce recorded on Friday after a strong sell-off.
As shown below, the cluster of Ethereum whales holding 10,000 to 100,000 coins have been dumping on the market since mid-July. Evidently so, between July 14 and August 18, they depleted their ETH holdings by 1.12 million coins.
With ETH currently trading around $1,660, the 1.12 million coins dumped by the whales are worth $1.86 billion. Notably, the recent trading patterns of this whale cohort have been closely correlated to ETH price movements.
Unsurprisingly, while the whales depleted their holdings by 4%, ETH price has also dropped by 18% between July 14 and August 18.
However, if an official announcement from the SEC confirms the recent Bloomberg report, it could convince them to end the selling frenzy.
Ethereum is Now Approaching the Oversold Territory
Following a month-long selling frenzy from the whales, Ethereum now appears to have slipped into the oversold territory. According to the Relative Strength Index data, Ethereum’s daily RSI for August 18 closed at 14.
In simple terms, it means 86% of ETH’s daily price movements in the last two weeks have trended downwards.
The Relative Strength Index data evaluates the strength and momentum of an asset’s current price trend. When the RSI corners below the 30 level from above, it suggests the asset is now oversold and could be due for a bullish reversal.
Strategic investors may interpret this as a signal to buy the dip in anticipation that the ETH price will react positively in the coming days.
Looking For a New Exchange? These Are the Best Crypto Sign-Up Bonuses in 2023
ETH Price Prediction: Bullish Expectations Could Hold Above $1,500
With ETH RSI now deep in oversold territory, investors looking to front-run a bullish reversal could nullify the whales’ ongoing selling frenzy. The Exchange On-chain Market Depth chart, which shows the price distribution of current active orders, also confirms this outlook.
As shown below, strategic crypto traders have placed orders to buy 50,720 ETH if the price drops to $1,500. But, if the industry-wide bearish momentum grows, it will likely drive ETH’s price toward $1,400 before a rebound.
Conversely, the Ethereum bulls could react to the Futures ETF Approval reports by staging an early attempt to reclaim the $1,900 milestone.
But, as shown above, crypto traders have opened orders to sell 25,380 ETH once the price hits $1,825. Without sufficient market demand, they will likely slow down the recovery mission.
However, if ETH scales that resistance, the bulls could push for the $1,900 target.
Interested in AI Trading? 9 Best AI Crypto Trading Bots to Maximize Your Profits
Disclaimer
In line with the Trust Project guidelines, this price analysis article is for informational purposes only and should not be considered financial or investment advice. BeInCrypto is committed to accurate, unbiased reporting, but market conditions are subject to change without notice. Always conduct your own research and consult with a professional before making any financial decisions. Please note that our Terms and Conditions, Privacy Policy, and Disclaimers have been updated.
