On-chain analytics platform Santiment has commented on the potential effects of recent heavy Ethereum sales on price. Since 2018, dormant whales have sold 150,000 ETH on April 18, while Ethereum price drops below $2,000.
Ethereum price drops as sleeper whales sell for 150,000 ETH
ETH price lost the critical support level of $2,000 on April 20, when Bitcoin lost the $29,000 support. At the time of writing, it is trading around $1,950, where it has moved sideways from the last 24 hours.
The downward momentum was triggered by massive Ethereum whales that have been dormant since 2018 selling 150,000 ETH on April 18. Analysis firm Santiment predicts the latest drop won’t last long…
Why loaded whale sales are good news for ETH
Santiment reports that when stablecoins move, they show large price swings, usually on the positive side. It was also stated that coins moving from old addresses to new addresses will be more likely to increase the rates of tokens moving between addresses on a network.
Whenever there is an uptick in the circulation of dormant ETHs, they usually coincide with price dips. Also, the average dollar investment age, shown in the red line below, has been moving down since last week. This shows that new investors have joined the network.
Santiment commented on the metrics he shared in his report: “Young average dollar investment is historically better for a bull pattern and we will need to watch closely to see if this trend continues”.
What does technical analysis say about Ethereum?
On April 19, ETH broke its price range for five consecutive days and fell nearly 6% as the bulls lost strength. The sell-off pushed Ethereum price below the $2,000 level, while the largest altcoin continues to rise. According to technical analysis, it could be curling up for a major breakout as it tests the main support at $1,822.
Considering that the open interest in the market is at an all-time high, the probability of an increase in volatility rises. As a result, any change in ETH price can easily explode stop loss orders. Such a result could lead to an acceleration of Ethereum price increases, with historical data showing that high open interest levels are often accompanied by large market fluctuations.
4 hour chart analysis
On the four-hour time frame, Ethereum price is seen vigorously testing the critical support at $1,822 that the bulls must defend to prevent further losses. The 5% sell-off on Wednesday does not indicate that ETH is in the bearish zone.
Instead, the critical support level is vital because defending it increases the likelihood that prices will recover and rebound in the coming days.
Conversely, a breach of the $1,822 support level could increase the chances of a lower price increase for Ethereum. The successful Shanghai upgrade, which we quoted as Kriptokoin.com, did not have a negative impact on the price, despite the $ 35 billion ETH released. Therefore, the performance of ETH after the Shapella upgrade will be more dependent on the risk appetite of the investors compared to technical analysis.
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