While the price of Ethereum After experiencing a brief rebound towards the end of Wednesday, the structure remains significantly weak below the surface. During this very negative period, the leading altcoin took a crucial step by confirming a bearish breakout, which could impact its near-term outlook.
Sellers now dominate the Ethereum market
Ethereumthe second-largest digital asset, is showing signs of growing weakness following the pullback in the broader cryptocurrency market. With volatility constantly trapping the market, ETH has now made a bearish breakdown.
PelinayPA, author and CryptoQuant data expert reported this development, which appears to shift control of the market firmly to sellers. Declining momentum has become more concerning due to the move below important support levels, and traders are increasingly bracing for additional downward pressure.
From a technical perspective, the market structure appears to be deteriorating when looking at Ethereum’s price action in conjunction with Binance’s long and short liquidation data. Looking at the chart, ETH has made a downward breakout from a triangle formation, a move that signals a consolidation shift in favor of sellers.
A collapse below the lower triangle boundary is not enough to definitively indicate a bearish scenario, but the moving averages have also started to decline. This development confirms the downward dynamic.
Furthermore, the short-term moving average remaining below the long-term average indicates that persistent weakness in dynamicscausing rallies of relief at the selling pressure. Pelinay pointed out that the decline in the blue moving average indicates a decline in the overall trend structure.
Besides this bearish breakout, another critical factor spotted on the chart is Binance liquidation data. Since a significant part of the planet Ethereum Derivatives volume flows through Binance, liquidation clusters formed on the platform are important to overall market direction.
Leveraged long positions are gradually phased out
Typically, sharp liquidations coinciding with price weakness are a sign that leveraged long positions are being eliminated and the market is undergoing a downward reset. These periods are mainly characterized by an unwinding of aggressive positions by institutional and large-scale market players.
Pelinay added that the market’s failure to produce a strong recovery after recent spikes in liquidations also reflects continued weakness in price structure. From a technical perspective, the likelihood of a deeper pullback towards the lower support zone of the chart is still present, but the downside breakout still holds for now.
Thus, if Ethereum fails to recover the broken triangle structure, the selling pressure could intensify and the price could target the $1,350 support level. At this point, Ethereum Whales are starting to leave the market. Ali Graphics highlighted that around 60 whale wallet addresses holding at least 10,000 ETH have completely emptied or consolidated their balances in the last 2 months.
When separate entities holding multi-million dollar positions leave the network in such a short time frame, it often indicates institutional profit-taking and asset reallocation. These large investors are currently taking advantage of recent liquidity to reduce risk, reflecting a clear lack of confidence in the medium term.
This reduction in whale numbers corresponds with recent large inflows into crypto exchanges. According to the data, the path of least resistance will continue to decline in the near future, with Ali focusing on the $2,000 bottom with extreme caution.
Featured image from Getty Images, chart from Tradingview.com
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