Following continued low demand from institutional investors, Ethereum (ETH) price remained bearish last week. The top-tier altcoin had its lowest weekly close since early February at around $2,294. However, the bearish momentum is expected to fade significantly in the short-term after it nearly retested the August 5 lows.
Furthermore, the expected economic shift in the United States amid the upcoming general elections is likely to increase crypto liquidity in the following months. Moreover, Bitcoinâs dominance is on the verge of a macro reversal, which will accelerate the rate of cryptocurrency rotation into altcoins.
Ethereum Whales Lose Appetite
According to on-chain data analysis from Glassnode, Ethereum whales have drastically reduced their accumulation rate in early July and have been taking profits since then. For example, US-based spot Ether ETFs have recorded just one weekly net cash inflow since their historic approval in July.
In total, US spot Ether ETFs, led by Grayscale’s ETHE, recorded net outflows of approximately $568 million.
Meanwhile, on-chain data shows that more Ether whales have increased their selling pressure, even at a loss.
Increasing network activity
Despite the increased bearish sentiment, the Ethereum ecosystem has registered significant growth in recent times. According to on-chain data analysis conducted by Santiment, the Ethereum ecosystem reached a four-month peak in network growth, indicating a potential bullish rebound in the future.
On Sunday, Ethereum welcomed over 126,000 new wallets. The Ethereum network is greatly strengthened by its rollups, which help to seamlessly onboard more users in specific niches, including gaming and real-world assets tokenization.
Medium-term price expectations
From a technical standpoint, it is likely that Ether price will retest the support level around $2,163 in the near term before bouncing back to its all-time high. However, a consistent close below the established support ascending trendline over the past year will result in further bearish sentiment in the coming months, possibly below $2k.
