Ether may fall below $1.9K ‘robust’ demand zone, analysts eye capitulation

Ether Risks Another Decline Below $1,900, but May Unleash Significant Demand and Spark Recovery

Ether (ETH) price has been struggling to recover from its three-month downtrend, having fallen over 52% from its peak above $4,100 on December 16, 2024. According to Juan Pellicer, senior research analyst at IntoTheBlock, another decline below $1,900 is on the horizon, but this could also unleash significant buying pressure.

Onchain metrics reveal a robust demand zone for ETH just below $1,900, Pellicer noted. Historically, around 4.3 million ETH were bought in the $1,848–$1,905 range, signaling substantial support. If ETH drops below this level, capitulation risks rise, as demand beyond this zone appears much thinner.

Capitulation and Its Implications

In financial markets, capitulation refers to investors selling their positions in a panic, leading to a significant price decline and signaling an imminent market bottom before the start of the next uptrend. This phenomenon can be seen in the current Ethereum market, where a decline below $1,900 could lead to a temporary correction.

Whale Accumulation and Future Price Action

Nicolai Sondergaard, research analyst at Nansen, believes that while Ether may see a temporary correction below $1,900, it is unlikely to fall much lower due to growing whale accumulation. “It does seem likely that if ETH is unable to hold the $1,900 level that we’d see further downside,” Sondergaard said. “Supposedly whales have been accumulating, and WLFI also holds substantial amounts of ETH, and regardless, price action has not been favorable.”

This behavior is also reflected in recent options data, where larger players/institutions were positioning themselves for moves in either direction, indicating market uncertainty about where ETH is heading.

Whale Address Count and Accumulation

According to Glassnode data, whale addresses with at least 1,000 ETH or $1.92 million, rose over 4% year-to-date, from 4,652 addresses on January 1 to over 4,843 addresses on March 14. This suggests that whales are accumulating Ethereum, which could have a significant impact on the market.

Conclusion

In conclusion, while Ether risks another decline below $1,900, this could also unleash significant buying pressure and spark recovery. The market is currently uncertain, with whales accumulating and larger players positioning themselves for moves in either direction. As the market continues to evolve, it is essential to monitor key metrics and market trends to make informed decisions.

FAQs

Q: What is the current state of the Ethereum market?

A: The Ethereum market is currently in a downtrend, having fallen over 52% from its peak above $4,100 on December 16, 2024.

Q: What is the potential impact of a decline below $1,900?

A: A decline below $1,900 could lead to a temporary correction and potentially spark buying pressure, as seen in the past.

Q: What is the current sentiment among whales and larger players?

A: According to recent options data, larger players/institutions are positioning themselves for moves in either direction, indicating market uncertainty about where ETH is heading.

Q: What is the current whale address count, and what does it indicate?

A: The current whale address count with at least 1,000 ETH or $1.92 million has risen over 4% year-to-date, indicating growing accumulation of Ethereum by whales.