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After The Merge, the wealthy whales of Ethereum go on the attack

  • Post category:Economy News
  • Reading time:12 mins read

Ethereum out of breath? – Ethereum has performed the update the largest in its history and we will now see Ethereum working thanks to Proof of Stake. An update that allows in particular to drastically reduce electricity consumption, which is not nothing in the current context. The Merge event went well, but that didn’t stop the market from selling ETH. Yesterday, the asset lost almost 10% and it sounds like the famous “buy the rumour, sell the news”. Now that The Merge has passed, will the price be able to let go or was it the event that allowed the price to recover in recent weeks? As the leader of altcoins, if Ether drops, all altcoins that might take a hit.

Ethereum back at $1,250?

The Merge is over! Can this change in functioning help the price go up? First, the argument of electricity consumption could appeal to market players. Then the asset becomes deflationary. The effect of scarcity could help the price to rise in the coming months if the demand is there. In the meantime, the price remains globally bearish weekly and, The Merge, has not changed this state of affairs:

Ethereum price against the dollar (1W)

Since support was lost at $1,900Ethereum is trending bearish. At the moment, Ether is made dismiss for the second time in a few weeks at the level of the institutional bias (EMA 9/EMA 18). The local top is brittle, it will have to be transformed into an “M top” or a bullish continuation. The two levels to be observed are $1,400 and $1,800 :

  • Downside scenario : if the price falls and closes below $1,400the sellers regain control and Ethereum will probably join the bracket at $1,250.
  • Bullish scenario : if the buyers push and cause the price to close above $1,800the price could then break the resistance weekly at $1,900 and continue its rise towards the shorts reload area Between $2,500 and $3,000.

You got it, the hard zone is the weekly resistance at $1,900. Currently, the price remains in trend bullishas long as the last trough at $1,400 is maintained. Buyers must block sellers above $1,900but it’s not done yet.

The RSI is showing fragilitybecause it always evolves under the bearish trendline. This fragility prevents the price from breaking out of the weekly resistance. On the other hand, the MACD shows a bullish divergence weekly. This could allow the course to create a storage area. A range that could be done between the two key areas on a weekly basis, between $1,900 and $1,000.

Ethereum must revive the bullish momentum on a daily basis

Ethereum stuck at $1,900but the course remains undecided:

Ethereum could join the reload zone if it closes below $1,400.
Ethereum price against the dollar (1D)

Buyers have the option of regaining control in the event of a close above $1,780. The price is still moving above the bullish trendline and he could use it for bounce in the next few days. If the price breaks this trendline, the sellers prevail and they will probably take the price into the reloading area Between $1,120 and $1,320.

Ethereum hesitant against Bitcoin

The price of Ethereum against Bitcoin is interesting to study. It helps to know if altcoins can outperform Bitcoin. The course is in a tidy for over a year and buyers have been struggling to cross the resistance :

Ethereum against Bitcoin: a range for more than a year.
Price of Ethereum against Bitcoin (3D)

While the price seemed to take off and definitively leave the range, Bitcoin woke up and put doubt on this chart. The trend remains bullish, but be careful not to lose the last ascending trough. the institutional bias is well oriented rise and could allow for a further rally in price, but buyers need to show up.

The risk is to get dismiss at the resistance level and find the bottom of the range, or break it down. The altcoins would then be in large dangeras they have already lost a lot of value against the dollar.

Momentum is encouraging as it is moving above the bearish trendline. Buyers can take advantage of this, but the RSI will have to rebound again at the level of the bearish trendline. We feel that the battle between buyers and sellers is not over yet.

To analyse on chain : the exchanges record strong deposits in Ethereum

Ethereum deposits and withdrawals on exchanges

Exchanges record strong Ethereum deposits.
Deposits (green) and withdrawals (red) of Ethereum on the exchanges Source: Glassnode

Over the past few days, we have observed heavy deposits at the exchange level. It looks like the actors are ready to sell after The Merge update. The last time there were strong deposits like this was in July 2022 and that marked the lowest in the market. We can’t know if the same scenario can happen again, but the actors seem to have fear. To complete this information, let’s see the behavior of whales.

The whales still oriented to purchase after The Merge?

The whales are entities with more than 1,000 BTC in portfolio. For Ethereum, which has a lower price than Bitcoin, it makes sense to look at players with more 10,000 ETH :

The whales are oriented to the purchase.
Number of addresses with more than 10,000 ETH Source: Glassnode

This graph is interesting because it shows the behaviour players with a substantial portfolio. After having distributed the top, it seems that they are in the process ofaccumulate ETH. This does not in any way mean that the course can only go up, it simply means that the big players in the market are still buying oriented. We will see if this behavior changes in the coming weeks.

A hypothesis can be put in place by reading the two graphs. It seems possible that the smaller players will get scared and sell out while the big players continue to sell.accumulate. If this is the case, the course will start in bullish continuation and will likely block small sellers.

Ethereum remains generally bearish on a weekly basis as long as the price does not return above the resistance at $1,900. In the shorter term, buyers need to defend the latest ascending low at $1,400 to avoid handing over to the sellers. In the event of a fence above $1,800, bullish continuation could happen. At the analysis level on chain, whales continue to pile up amid widespread fear in the aftermath of The Merge update. Has Ethereum had its market low at $880? The Merge went well, of course, but the course remains undecided…