Are Whales Who Broke Even Dumping? What's Behind Ethereum's $2,300 Collapse?

▲ Ethereum (ETH), Cryptocurrency decline/AI-generated image ©

Ethereum is continuing its precarious trend, giving up the $2,300 mark, pushed by selling pressure from investors who reached their break-even price and a wave of aggressive attacks from short sellers betting on a decline.

According to investment media FXStreet on May 8 (local time), Ethereum (ETH) fell 2% in a single day on Thursday, with selling pressure detected in key on-chain indicators. Particularly, the $2,300 to $2,500 range has acted as a distribution zone where strong selling pressure has concentrated over the past month, forming a thick resistance wall every time the price attempts to rise.

This area is where the average purchase prices, which are the realized prices for various types of investors, from whales holding 10,000 to 100,000 Ethereum to individual investors, are concentrated. As the overall market structure maintains a cautious stance, a clear distribution phenomenon is emerging where investors who have reached their break-even price are liquidating large quantities. In fact, individual investors have sold approximately 1,500,000 units over the past two weeks, and large whale wallets are also depositing tens of thousands of units into exchanges, intensifying the downward pressure.

Downward pressure targeting Ethereum is also strong in the derivatives market. Despite the price decline, open interest has surged to 14.85 million, its highest since July last year, indicating a rapid accumulation of short positions betting on a fall. Concurrently, the 30-day moving average Net Taker Volume indicator, which represents the proportion of market orders, is also on the verge of turning negative, suggesting that short traders are gradually gaining dominance in the futures market.

From a technical perspective, Ethereum continues its unstable tightrope walk. Over the past 24 hours, approximately $96.3 million worth of forced liquidations occurred, with $89.1 million of that being long positions anticipating a rise. The current price is finding support above the 50-day exponential moving average (EMA) at $2,262 but is blocked by resistance at the 100-day EMA of $2,349. Auxiliary indicators such as the Relative Strength Index (RSI) and Stochastic also show that buying pressure is gradually weakening.

If Ethereum fails to hold the $2,262 support line in the future, there is a possibility of it falling to $2,211, $2,107, and even further to $1,741. For a rebound, it must first reclaim the 100-day EMA of $2,349, and only by firmly breaking through the $2,388 resistance can it expect to regain upward momentum towards $2,746.

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