Ethereum (ETH) has entered a decisive phase after a piercing sell-off that wiped out most of its recent gains and pushed the price towards the closely watched $2,200 level. The move followed repeated failures to breach the $2,500-$2,550 zone, leading to liquidation.
Related reading: Crypto hack explosion: $370 million stolen in January alone: researchers
With huge holders taking contrarian positions and cautious on-chain data transfers, ETH is currently at a point where both downside risk and bounce potential remain in play.
ETH's price records major losses across the board. Source: ETHUSD on Tradingview
Ethereum price structure weakens as $2,200 takes center stage
Ethereum (ETH) dropped more than 20% from recent highs, briefly trading below $2,220 before stabilizing.
The decline pushed ETH below the $2,300-$2,400 range and below key short-term moving averages, shifting short-term control towards sellers. The technical data shows a developing bearish trend line around $2,400-$2,420, an area that needs to recover to ease downward pressure.
The $2,200 zone is currently acting as major support. A sustained break below this level could reveal deeper declines towards $2,050 or the psychological $2,000 level. Momentum indicators remain cautious, with the hourly RSI below 50 and the MACD still overlapping with bearish momentum, suggesting that buyers have not yet regained control.
Risk of distributing signals related to stock flows and liquidations
Chain data has added to concerns. Exchange proceeds surged before the crash, with approximately 600,000 ETH hitting major exchanges in a single day, including a surge on Binance. Such inflows are often associated with selling, hedging or risk reduction rather than accumulation.
At the same time, derivatives markets saw mighty pressure. ETH-related liquidations reached around $280 million in 24 hours, outperforming Bitcoin and confirming that long positions were crowded near recent highs.
The pace of deceleration suggests structural weakness as spot market demand failed to absorb forced selling as support levels faded.
Whale Longs add counterweight to the bull market
Despite the bearish flow data, whale activity is more variable. According to network analysts, dormant wallets reactivated after five years and provided over 45,000 ETH as collateral to open a huge long position on monetary margin, borrowing approximately $100 million.
The move highlights a growing divergence at current levels, with some institutions reducing leverage while some huge holders are increasing exposure.
Related Reading: Has Bitcoin Hit Bottom? CMT reveals what investors should see now
This clash between whale debt and bearish currency flows shows the uncertainty around $2,200. A rebound above $2,420 could swing momentum back towards buyers, while failure to hold current support could confirm that distributional pressures remain dominant.
Cover photo from ChatGPT, ETHUSD on Tradingview
