A dormant Ethereum whale recently staked 7,182 ETH, valued at $18 million, after being inactive for 1.2 years, despite facing an unrealized loss of $4.8 million. This move raises the question of whether the whale is correct in its optimism or if the retail investors who are currently selling off are making the smarter choice.
Ethereum’s price action has remained stagnant over the past week, with the asset continuing to create lower lows. Despite this lack of momentum, large holders, or whales, are adopting a defensive yet confident strategy.
The whale mentioned earlier chose to stake its tokens to earn yield instead of selling at a loss, which suggests a belief in Ethereum’s longer-term potential. This strategic staking can serve as a hedge in a ranging market, indicating a bullish intent among significant holders.
Moreover, data from IntoTheBlock highlights that Ethereum whales collectively accumulated 613,000 ETH within a mere 24-hour period. This notable buying spree reflects growing confidence among big players in the market, especially since Whale Netflow has remained positive for three consecutive days.
On the other hand, retail investors appear to be less optimistic. Recent analysis of Ethereum’s exchange activity shows a trend of higher inflows than outflows, signifying a surge in selling activity among retail participants.
Specifically, the Exchange Netflow was positive at 46.9K ETH over the last three days, suggesting a disconnect in market sentiment between whales and retail investors, with the latter seemingly preparing for a downturn. As the market oscillates, Ethereum faces potential challenges, particularly with certain technical indicators signaling bearish pressure.
Following a significant decline in the Stochastic RSI, which fell to an oversold level, and a bearish crossover in the RVGI, there is growing concern about Ethereum maintaining support at $2,438. A breach below this critical level could lead to a drastic decline, with estimates suggesting a potential drop towards $1,200.