ETH risks a fall to $3000 as investors realize increasing profits and losses

• Ethereum’s bearish pressure has strengthened following recent selling activity among long and short holders.
• Whales withstood the selling pressure after increasing their holdings by 410K ETH.
• ETH could fall towards the psychological $3,000 level if it breaks the $3,250 support.

Ethereum (ETH) rose 4% on Monday despite increased selling pressure among long and short holders over the past two days. If the whales fail to maintain their recent buying stance, ETH risks a dip below $3,000.

Ethereum Investors Step Up Selling Pressure, Whales Buy Dip

Ethereum witnessed an increase in bearish sentiment after experiencing double-digit losses last week.

ETH’s weighted sentiment, which measures the asset’s social volume and its overall sentiment, remained below its neutral level, indicating highly negative sentiment.

Ethereum Weighted Sentiment. Source: Sentiment

Bearish sentiment is also visible in the Realized Profit/Loss metric of the network, which shows that most investors have sold off their holdings to book gains and losses over the past 24 hours. Namely, investors made more than 340 million dollars in profit and 30 million dollars in losses.

Realized profit/loss of the Ethereum network. Source: Sentiment

The inactive circulation metric reveals recent selling activity from both long and short holders, as evidenced by the spikes in the chart below. This indicates that the bearish trend is gradually strengthening.

Ethereum inactive circulation. Source: Sentiment

Despite the selling activity, Ethereum’s reserve continued its downward trend, and investors pulled back.

Most of those withdrawals came from whales holding between 100K and 1M ETH. This class of whales ended two weeks of consistent selling activity after increasing their holdings by 410K ETH in the past two days. The move signals confidence in the potential continuation of the uptrend after the holidays.

ETH Whale Holdings (100K to 1M ETH). Source: Sentiment

Meanwhile, US spot Ethereum ETFs managed to maintain their weekly streak of net inflows even after the outflows on Thursday and Friday. Products saw net inflows of $62.7 million last week, extending the inflow streak to four consecutive weeks, according to Coinglass data.

Ethereum Price Forecast: ETH Could Find Support at $3,000 Psychological Level If It Breaks Below $3,250

After extending the decline below the 50-day simple moving average (SMA), ETH hovered within the $3,250 support and $3,423 resistance levels over the weekend as prices appear to stabilize due to the holiday season.

ETH/USDT Daily Chart

The $3,250 level is crucial even as prices move in a limited range. ETH could fall towards the psychological $3,000 level if it breaks the $3,250 support.

The $3,000 target is obtained by measuring the height of the double top pattern released by ETH within the first two weeks of December, to the neckline support level. The 100-day and 200-day SMAs could strengthen the psychological level of $3,000 as a key support zone.

However, a further break of the $3,000 support level will confirm a top-rounding pattern that could send ETH towards the psychological $2,000 level. The key support level at $2,817 could cushion such a decline.

On the way up, ETH needs to recover the $3,550 support level on heavy volume to continue the uptrend.

Relative Strength Indicators (RSI) and Stochastic Oscillator (Stoch) are below their neutral levels, indicating that the market is leaning towards bearish momentum.

A daily close of the candle above $4,093 will invalidate the bearish thesis.

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