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Look for Ethereum’s price to fall by nearly 6% in the last 24 hours and nearly 13% in two days, continuing its volatile January decline. The price saw a temporary drop below key levels, raising new doubts about whether buyers can regain control.
But below the surface, watch for whales making a forceful entrance. Almost $360 million of ETH was accumulated by the whales near the dip. The case of rebound looks attractive, but the money of professional traders (informed traders) are not convinced.
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The triangle pattern and positive skewness makes for a dense supply cluster
Ethereum is moving Inside a symmetrical triangle on the daily paper. The sellers rejected the price near the upper trend line earlier, around January 14. Now the price is testing the lower boundary. But can buyers save the situation now?
Momentum shows an important signal. Between November 4 and January 20, Ethereum made a lower low while the Relative Strength Index (RSI) made a higher low. The Relative Strength Index measures momentum by comparing recent gains and losses. These positive deviations indicate that the selling pressure is weakening, even when the price tests the support level.
This type of signal has been important in the past. In early January, a negative divergence in the RSI preceded the recent decline. Now the opposite pattern is forming, hinting at the possibility of a reversal instead of a continuation.
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The potential increase, however, faces a clear obstacle. The cost base data indicates a heavy supply cluster between about 3,146 and 3,164. About 3.44 million were accumulated ETH In this area.
Many holders are close to spreading. This area often turns into a strong resistance. Any rebound should break out of this rally to test strength and turn into a reversal as the RSI indicates.
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The whales are buying the dip, but the smart money is waiting
Whales act with conviction. As BeinCrypto explained when Ethereum fell by about 13% (between January 19th and January 21st), whale assets increased from about 103.42 million eth to about 103.71 million eth. This increase represents approximately $360 million in backlog at near-current prices. This behavior is not new.
The purchase of whales appeared almost identical to January 14, just before the strong rebound. Also, Ethereum whales have started to accumulate supply again in the last few hours.
This steady rate of accumulation indicates confidence that the downside is limited near current levels. Whales are willing to absorb the supply during periods of weakness.
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The smart money tells a different story.
The Smart Money Index, which tracks the positions of informed investors, remains below its signal line. The smart money often moves aggressively faster before sustained runs. In December, when this indicator rose above the signal line, the price of Ethereum increased by about 26% in ten days. A similar move at the end of December pushed a 16% advance in mid-January.
The market lacks that kind of confirmation right now. The smart money seems to be waiting for evidence of a resistance breakthrough. The presence of a large average cost cluster above the eth price probably explains this hesitation. Until the supply is absorbed, patience seems a logical step.
Ethereum price levels reveal the key zone
Everything now moves towards a narrow range of levels.
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The first level should be restored to $3,050. As BeinCrypto pointed out, Ethereum lost this important multi-point support during the recent pullbacks. The end of each day above this level indicates the beginning of stabilization.
Call attention to the $3,160 area. This level corresponds to several touch points and is aligned with the supply cluster based on the average purchase cost. A clear intraday close above this level represents an upside of about 6% from current prices. Most importantly, it will break strong resistance and can attract the smart money to return. After that, a reversal pattern can form.
If this happens, momentum could accelerate quickly. Confirmation of the breakout opened the way towards $3,390 where a broader bullish reversal is forming.
On the downside, losing the lower triangle support near $2,910 weakens the rebound hypothesis. A sustained break of this level exposes $2,610 as the next major support.
Ethereum sellers have made it clear that they have won the last battle, but the war is still on. The whales began to sit down, preparing to return. The smart money is waiting for proof. If Ethereum can clear the supply wall at $3,160, the hesitation could quickly turn into momentum.
