Ethereum, the second-largest cryptocurrency by market capitalization, is showing bullish signs as whale activity around the asset declines. According to data from Santiment, Ethereum (ETH) experienced a 3.8% decline in the past 24 hours, trading at $2,620 at the time of writing with a market cap of $315 billion. Despite the price drop, ETH’s daily trading volume increased by 3% to $15.6 billion.
One key indicator of Ethereum’s bullish outlook is the decrease in whale activity. Santiment reported that the number of whale transactions, defined as transactions consisting of at least $100,000 worth of ETH, has been steadily decreasing over the past three days. This decline in whale activity, from 5,371 transactions on August 12 to 4,346 transactions in the past day, suggests a shift in market dynamics.
Additionally, Ethereum’s total open interest decreased from $5.28 billion on August 12 to $5.05 billion, indicating lower price volatility and fewer liquidations. The total funding rates for ETH also dropped below zero for the first time since October 2023, currently sitting at negative 0.0002%. Historically, a negative funding rate has signaled a short-term bullish momentum for Ethereum, despite traders anticipating a price drop.
The Ethereum Relative Strength Index (RSI) is also showing that the asset is slightly oversold, hovering around the 42 mark. While this could indicate a potential buying opportunity, further selloffs could trigger fear, uncertainty, and doubt (FUD) among investors and push the ETH price lower.
One factor contributing to the recent decline in Ethereum’s price is the Jump Trading selloff. The company has accumulated over $64 million worth of ETH tokens from various platforms and appears poised for a significant sale. This sell-off could put additional downward pressure on Ethereum’s price in the short term.
Overall, despite the recent price drop, Ethereum’s on-chain movements and decreasing whale activity suggest a positive outlook for the cryptocurrency. Traders and investors will be closely monitoring these indicators to gauge the future direction of Ethereum’s price.