Ethereum Price Faces Risk as Whale Activity Continues to Decline

Ethereum’s price is at a critical juncture as whale activity declines for a seventh day, raising concerns about weakening institutional confidence. While the BBTrend indicator suggests bullish momentum has shifted upward to 4.99, the market must navigate the resistance at $2,900 and support at $2,679. A failure to hold this support could mean further price drops, whereas breaking the resistance might lead to a rally toward $3,000.

Ethereum (ETH) is currently dancing around a pivotal technical level, with traders right on the edge—eagerly anticipating whether it will break higher or fall lower. Notably, the BBTrend indicator recently made a sharp upward movement to 4.99, a significant rise from the previous day’s record of -3. This swing indicates potential building bullish momentum.

However, there’s a contrasting trend to consider: whale activity has been in decline for the last week, continuing a drop to just 5,378 wallets holding between 1,000 and 10,000 ETH. This decline from 5,427 ten days ago might signal waning institutional confidence. As Ethereum hovers between resistance at $2,900 and key support at $2,679, the pressure is mounting for the next significant price movement, which could dictate short-term direction.

The BBTrend’s recent jump to 4.99 reflects growing expectations of an upswing; a sharp recovery suggests that bearish trends may be reversing. Essentially, if the trend remains strong and positive, ETH could see further upside, changing trader sentiment and positioning significantly. It’s all about how traders interpret these changes, especially in a volatile market.

Meanwhile, the ongoing decline of whale counts raises eyebrows. Typically, high numbers of whales are seen as bullish, suggesting confidence among institutional and high-net-worth investors. Sustained drops in this group can hint at profit-taking or reduced confidence in short-term performance. The influence these large holders have can significantly impact market sentiment; hence, the current two-week trend downward could mean greater volatility ahead.

Ethereum’s price action is fast approaching a critical support level at $2,679 after recent attempts to breach the $2,900 resistance failed. If this support level crumbles, it could pave the way for further drops to $2,479 and possibly $2,326. Breaking through these thresholds would signal a major shift in market trends and could lead to heightened selling pressure.

On a more positive note, the strengthening BBTrend does hint at potential buying pressure, suggesting some traders might still be looking for an entry point. Should Ethereum manage to break through that stubborn $2,900 barrier, we might see a rally towards $3,000, a milestone not reached since early February. Success here could truly galvanise bullish sentiment and revive interest among sidelined investors.

However, before any of these hopeful scenarios unfold, bulls will need to reclaim their ground effectively and turn $2,900 into a robust support level. Until then, the situation remains precarious as market participants closely watch for signs of direction.