Ethereum's Price Volatility: 10% Drop, 10,702 ETH Sold by Whale

Ethereum (ETH), the leading smart contract protocol, is currently under scrutiny by crypto analysts who suggest that the asset may be undervalued based on on-chain indicators. According to a popular crypto analyst, Ethereum's current price could be significantly lower than its intrinsic value. This analysis is supported by the Entity-Adjusted Dormancy Flow, which measures the ratio of a coin’s market cap and its annualized dormancy value tracked in US dollars. When Ethereum approaches the -1 standard deviation pricing band, it historically indicates a macro bottom zone, suggesting that the asset may be undervalued and that long-term holders are less inclined to sell.

Ali Martinez, a well-known crypto analyst, shared his insights with his 135,100 followers on the social media platform X. He noted that Ethereum's Entity-Adjusted Dormancy Flow has dropped below one million, indicating that the asset may be in the midst of carving a major cycle bottom. This historically suggests a macro bottom zone, meaning ETH might be undervalued and long-term holders are less inclined to sell. It also suggests that sentiment is low, capitulation may have occurred, and smart money might be accumulating.

Martinez also highlighted that 453,000 Ethereum have been withdrawn from crypto exchanges in the past five days. Large amounts of ETH flowing out from exchanges can serve as a bullish indicator as deep-pocketed investors accumulate the asset. This movement suggests that investors are confident in Ethereum's long-term prospects and are positioning themselves accordingly.

Despite these bullish signals, recent Ethereum whale activity raises concerns. A dormant Ethereum whale, holding since 2016, sold off 10,702 ETH during the recent market crash, signaling declining investor confidence. Martinez warned that if key supports falter, the price could face further downward pressure, potentially dropping to $1,200. This uncertainty underscores the need for cautious analysis and monitoring of Ethereum's price movements.

Ethereum's price analysis over the past 24 hours reveals a volatile trading pattern. The day started with a stable downtrend, leading to a support level at $1,603 by 3:00 UTC. However, bearish pressure continued to dominate, causing Ethereum to fall to $1,586 by 7:30 UTC. The price consolidated around this support level until a massive death cross formed on the MACD at 14:40, leading to a significant price drop to $1,480 within two hours. Despite the heavily oversold market conditions, a golden cross appeared at 16:25, initiating an extended uptrend that stabilized the price around $1,530 by 22:50. Since then, Ethereum has fluctuated around the $1,550 mark.

Looking ahead, the $1,580 resistance level remains a key hurdle for Ethereum to regain the $1,600 mark. The Relative Strength Index (RSI) is closing in on overbought zones, suggesting a potential corrective phase. If Ethereum falls, it will seek support as close to $1,550 as possible. Success in finding this support could pave the way for testing key resistances, while failure may lead to further volatility and exciting developments in the near future.