Ethereum Liquidations Surge After Breaking Below 4-Week Ascending Range

Ethereum crypto previously traded in a range-bound price action for the last 4 weeks. It previously demonstrated signs of a potential bounce from the range support but a bearish outcome occurred after geopolitical concerns led to weak investor sentiment.

Rather than a bounce from support, ETH price broke below the same support level, leading to further downside. ETH was down to $2190 at press time. It is also worth noting that it was almost oversold.

According to recent market data, leveraged long traders were among the biggest victims of the bearish Ethereum crypto price outcome. Coinglass data revealed that ETH long liquidations surged above $320 million in the last 24 hours.

According to CryptoQuant, the broader market figure was much higher. Liquidations worth almost 365,000 ETH occurred in the last 24 hours. That figure was equivalent to over $803 million at its press time price tag.

This latest spike in liquidation marked the highest long liquidation event observed in the last 12 months. The liquidations confirmed that there were heavy bullish expectations prior to the break below support.

Can Ethereum Crypto Bulls Make Comeback After Massive Liquidation?

The leverage shakedown during the weekend may pave the way for another round of accumulation. That may already be happening especially in the whale category where large buys were reported over the last few hours.

On-chain Lens revealed that one particular whale moved about 26,255 ETH worth about $60 million from Binance and into a newly created private wallet.

There were other reports of major whale activity which signaled heavy accumulation. For example, Coinglass large order flow data revealed that roughly $10.53 million worth of spot demand was observed between Saturday and Sunday as prices fell.

The data was collected from Coinbase, OKX and Binance spot segments. Roughly $5.12 million worth of demand was observed on OKX and Binance perpetual markets.

The return of demand from the whale category may signal that ETH might be on the verge of a pivot after its latest discount.

Whales Take Advantage of Volatile Market Conditions to Trigger Leverage Shake-Down

What’s interesting about whales jumping back after the Ethereum price pattern break was that they previously contribute to the downside. In other words, whales were among the biggest sellers last week.

According to a recent CryptoQuant analysis, the recent surge in sell pressure was characterized by a large spike in profit-taking among the whale cohort. Similar observations were made in May and February.

The special circumstances that occurred this past weekend indicated that whales may have triggered the break below the pattern range.

The wave of sell pressure from whales may have set the market up for a major liquidation event, which resulted in a massive leverage liquidation.

But what’s next for ETH considering the observation that whales are buying back already? Well, the recent surge in uncertainty was a major factor in the bearish market outcome during the weekend.

The same major factor will likely maintain its choke-hold on the bulls especially if geopolitical tensions continue rising.

ETH may decline below $2,000 under such conditions and this means buyers might be trying to catch a falling knife.

However, the uncertainty also means that identifying the bottom of the trend will not be easy. Therefore, a dollar-cost-averaging strategy would be the most sensible approach for investors.

It may also be worth noting that ETH had already retested another major ascending support level at press time. This means the bulls may get yet another opportunity to challenge the bears for dominance.

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