Will Holders Trigger Strong Selloff?

Ethereum (ETH) showed signs of cooling volatility after failing to break above the $4,000 resistance level over the weekend. Despite strong momentum earlier this month, the price was firmly rejected near this psychological level, raising concerns about a potential selloff. This is due to weakening buying pressure and low volatility, according to on-chain data. Some traders see the rejection as a signal to take profits, especially after ETH’s steady climb over the past few weeks.

Ethereum’s Volatility Drops Below 50%

In the past 24 hours, Ethereum (ETH) has seen a spike in price swings. According to Coinglass, about $124.5 million worth of ETH positions were liquidated, with both buyers and sellers affected equally.

The price drop came after a period of low volatility. Data from IntoTheBlock shows Ethereum’s volatility has fallen from a high of 53.9% to 47.6%. At the same time, activity from large investors, or “whales,” has decreased. The total value of large transactions dropped sharply from $21.3 billion to $5.9 billion in just one week.

This slowdown in key metrics has reduced buying interest. Fewer long-term holders are adding to their positions, and many are already sitting on profits, making them more likely to sell.

Despite this, Ethereum spot ETFs have seen strong inflows. On July 25 alone, they recorded $452 million in positive netflows — the 16th straight day of gains in July.

Institutional interest also remains high, supported by Ethereum-focused companies and their stock market performance. This suggests that while retail investors may be cooling off, institutional demand could help drive ETH higher in the long run.

So, although short-term buying has slowed and volatility has dipped, the bigger picture still points to a bullish outlook for Ethereum in the days ahead.

What’s Next for ETH Price?

Ethereum (ETH) is running into strong resistance from sellers around the $4,000 level. However, it’s a good sign that buyers aren’t giving up much ground. As of writing, ETH price trades at $3,807, declining over 0.37% in the last 24 hours.

When a price stays close to a tough resistance level without falling much, it often means a breakout could be coming. If ETH breaks above $4,000, it may push higher and test the next major level at $4,100. If it moves past that, it could kick off a new rally toward $4,900.

On the downside, the first support level is at EMA20 trend line. If ETH drops below that, the next likely stop is around $3,500. Buyers will likely step in strongly at that level, because if it breaks, momentum could shift in favor of the sellers.

The RSI (Relative Strength Index) is dropping quickly and is now around 51, which gives an edge to the sellers. However, the recent price dip is drawing in a lot of buying interest. If Ethereum can bounce back above the 23.6% Fibonacci level, there’s a good chance the price could make a strong recovery.