Ethereum Drops 5.5% as $312 Million Whale Transfer Fuels Sell-Off

A significant transfer of 129,392 ETH, valued at approximately $312 million, from an unidentified wallet to Coinbase has sparked concerns of an impending sell-off in the Ethereum market. This transfer, reported by blockchain tracking service Whale Alert, marks the first major activity from this wallet since November 2022, raising speculation about the potential impact on Ethereum's price.

The timing of this transfer is particularly noteworthy as it coincides with Ethereum's struggle to maintain its price above $2,500, which had already begun to falter and was hovering around $2,400. The wallet involved, identified as "0xd47b," had been relatively inactive since late 2022, with its last transaction being an inflow of 6,469 ETH from another wallet linked to Coinbase.

This latest transfer into Coinbase has exacerbated fears of a sell-off, as exchange inflows of this magnitude are often precursors to liquidation, especially given the current edge in investor sentiment. The Ethereum price has since lost a key support level at $2,450 and has experienced a notable decline in the past 48 hours. While geopolitical tensions, such as the recent US attacks on Iran, are also contributing factors, the whale deposit into Coinbase has likely increased the downward pressure on the price.

The technical outlook for Ethereum has turned bearish in the short term. A breakdown below a crucial support line at $2,362 on the 4-hour chart confirms a bearish setup. This breach amplifies the bearish case, with potential reversal targets identified at $2,151 and $1,954, and a third possible level at $1,750 if the selloff intensifies. At the time of writing, Ethereum is trading at $2,290, reflecting a 5.5% and 10% decline in the past 24 hours and seven days, respectively.

The Ichimoku Cloud overlay on the chart indicates fading bullish momentum over the past few days. Previous failed attempts to break resistance have left Ethereum in a vulnerable position, and the recent whale selloff may have provided the final push needed to trigger this downward movement. If the current trajectory continues, Ethereum could be on its way to retesting lows below $2,000, further exacerbating the bearish sentiment in the market.