Ethereum ETF Outflows Surge Amid Whale Selloff, ETH Flashes Sell Signal

The Ethereum (ETH) market is facing intensified selling pressure and notable outflows from ETH ETFs. Moreover, the market has witnessed sharp sell-off by major ETH whales and institutional investors. This development comes at a time when Ethereum price is at a crucial juncture, with analysts pointing to technical indicators that suggest further downside risk.

Ethereum ETF Outflows Surge

On Thursday, August 15, spot Ethereum ETFs experienced a total net outflow of $39.2 million, a clear indication of investors’ waning confidence in the crypto’s short-term prospects. The most notable movement was in Grayscale’s Ethereum Trust (ETHE), which recorded an outflow of $42.5 million.

Meanwhile, Fidelity’s Ether ETF (FETH) saw a modest inflow of $2.54 million, according to Farside Investors. The net asset value of spot Ethereum ETFs has now dropped to $7.16 billion, a significant decrease from over $10 billion AUM at their inception. These outflows underscore a growing cautiousness among investors.

Further bearish sentiment spurred as a prominent Ethereum whale recently offloaded a significant portion of their holdings. On August 5, during a market dip, this whale purchased 2,978 ETH at an average price of $2,367, spending approximately 7.05 million USDT. However, today, the same whale sold all the acquired ETH at average price of $2,586, realizing a profit of $720,000.

Moreover, Ether long liquidations hit $46.97 million today, according to Coinglass. Also, recently BlockTower Capital sold ETH worth $25 million while an ICO whale offloaded a whopping $154 million in Ethereum.

Amid Ethereum ETF outflows and ETH selloffs, noted crypto analyst Ali Martinez highlighted that the TD Sequential indicator has flashed a sell signal on the crypto’s hourly chart. Hence, he predicted a potential one to four candlesticks correction in the short-term.

ETH Price Analysis

Further adding to the bearish outlook, Crypto Quant analyst Amr Taha pointed out a notable pattern in staking inflows and price drops. His analysis reveals that significant inflows of Ethereum into staking contracts are often followed by sharp price declines.

This pattern was particularly evident at the end of July and in mid-August, where large staking events coincided with Ethereum’s price volatility. As of the latest data, staking inflows have surpassed 16,000 ETH, a figure that could signal more price turbulence ahead.

Ethereum is currently trading between two critical levels: support at $2,060, marked by the 200-day Exponential Moving Average (EMA), and resistance at $2,817, defined by the 50-day EMA and the 50% Fibonacci retracement level. The direction in which Ethereum price breaks out from this range will likely set the tone for its short-term trend.

However, the looming threat of a “death cross” amid Ethereum ETF outflows could further accelerate ETH price decline. The 20-day EMA is converging towards the 50-day EMA on the weekly chart, a setup that has historically led to significant price drops, according to a previous analysis by Coingape.

The last occurrence of this pattern in May 2022 saw Ethereum plummet by 68%, from $2,885 to $887. Adding to the bearish case, the Relative Strength Index (RSI) for Ethereum remains in a downtrend, currently positioned neutrally at 42. This suggests that Ethereum is not yet oversold, leaving room for further declines before any potential reversal.