Ethereum (ETH) Price Rebounds Fueled by Rising Whale Demand amid Heightened Fear of Crypto Capitulation

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As a seasoned researcher with over two decades of experience in the financial markets, I have witnessed numerous bull and bear cycles, and the current Ethereum price rebound is reminiscent of a phoenix rising from the ashes. The technical indicators, market trends, whale activities, and institutional investments all point towards a strong recovery for ETH.

After the recent crypto market crash that cost over $1.6 billion from highly leveraged traders, Ethereum (ETH) experienced a significant recovery, surging by approximately 14% within the last 24 hours. This placed its current value at around $2,514 during Tuesday’s European trading session.

In simpler terms, even though August saw a downturn across the cryptocurrency market, the value of Ethereum relative to the US dollar has bounced back from an ascending logarithmic trendline on a weekly scale. As long as Ethereum’s price stays above this rising trendline, it could indicate continued bullish trends in the last three months of the year.

Top Reasons Ethereum Price Rebounded

In the last 24 hours, the Ethereum price mirrored Bitcoin‘s price surge. This development led to a significant increase of more than 8% in the overall cryptocurrency market capitalization, allowing it to regain a value of approximately $2 trillion on Tuesday.

In sync with the Asian stock market recovery, primarily driven by the Nikkei 225 and Asia Dow, the crypto industry also experienced a surge. Likewise, European stock markets started Tuesday optimistically, thanks to the FTSE 100 and DAX. Anticipating a similar trend, the US stock market is predicted to bounce back later today, following substantial losses on Monday.

In the meantime, long-term investors took advantage of widespread panic, evident in the 17% reading of the fear component on the Ethereum’s fear and greed scale.

Ethereum Fear and Greed Index is 17 — Extreme FearCurrent price: $2,419

— Ethereum Fear and Greed Index (@EthereumFear) August 6, 2024

As an analyst, I’ve observed some strategic Ethereum (ETH) acquisitions by notable crypto whales over the past day across various exchanges. For example, Justin Sun, founder of the Tron (TRX) network, withdrew approximately 14,884 Ether, equating to around $35 million, from Binance within the same timeframe.

Consequently, Sun owns approximately 392,474 Ether tokens, which are valued around one billion dollars. Importantly, Sun declared a billion-dollar investment fund on Monday aiming to alleviate uncertainty in the market and enhance cryptocurrency liquidity.

Another whale was spotted purchasing Ether from HTX after depositing $38 million USDT.

38 million USDT was taken out of HTX by a whale, and 37 million USDT of that amount was used to purchase approximately 16,236 ETH for around 40.76 million USD, at an average price of roughly $2,279, about nine hours ago.
Currently, the unrealized profit is $3.76M!
— Lookonchain (@lookonchain) August 5, 2024

As a researcher, I’m reporting that US-based Ethereum ETFs experienced a favorable day on Monday, with an overall inflow of approximately $48 million. Interestingly, while Grayscale’s ETHE saw significant outflows, this was counterbalanced by a similar inflow of around $47 million for BlackRock’s ETHA. Notably, all other spot Ethereum ETF issuers except Invesco’s QETH and 21Shares’s CETH recorded positive cash flows on Monday.

Midterm Price Expectations

Since the beginning of last year, the price of Ethereum has been on an upward trajectory, marked by consecutive high points (high highs) and low points (high lows) when viewed weekly. It’s predicted that a recovery pattern similar to the V-shaped one seen after the 2020 Covid-19 crypto crash might occur in the upcoming weeks. This could potentially initiate the eagerly awaited parabolic surge during the overall long-term bull market.

If Ethereum’s closing prices stay persistently under the key support or resistance point at approximately $2,124 over the next few weeks, it suggests that the downward trend might persist, with sellers maintaining their dominance.

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2024-08-06 13:13