The leverage flush in the cryptocurrency market continues this week as Bitcoin, Ether, and other major cryptocurrencies are in the red.
Ether is down by nearly 4% in the last 24 hours and risks dropping below the $1,900 mark if the bearish trend continues.
Thanks to the latest bearish performance, over $300 million worth of leveraged positions were wiped out from the cryptocurrency market since Tuesday.
Ether’s bearish performance comes despite whales slowly returning to action as they accumulate more coins during the dip.
Whales resume buying more $ETH
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Whales were one one of the biggest Ether sellers earlier this month as the second-largest cryptocurrency by market cap dropped to the $1,700 region.
However, the whales have now begun accumulating once again. Data obtained from CryptoQuant shows that whales or wallets with a balance of 10K-100K $ETH began buying the dip last Wednesday.
Between February 4 and 8, these entities collectively accumulated over 520K $ETH.
During that period, retail investors (wallets holding 100-1K $ETH and 1K-10K $ETH) sold 233K $ETH, meaning the buying pressure from whales outweighed the selling pressure from retail investors for the first time since the beginning of the year.
Usually, prices have recorded a sharp increase when retail sell pressure weakens, and whales continue buying the dip.
However, the market conditions remain bearish, with Ether at risk of dropping below $1,900.
Furthermore, $ETH Net Taker Volume on the crypto exchange has returned to negative territory after briefly turning positive last month.
This suggests that shorts are building up positions in the market again.
This metric is crucial as it tracks the difference between buyers and sellers purchasing $ETH futures using market orders.
Finally, the $ETH Coinbase Premium has remained at a discount over the last three months, suggesting a continued selling pressure from US investors.
Ether could retest the $1,740 support level
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The $ETH/IUSD 4-hour chart is bearish as Ether has lost 14% of its value in the last seven days.
The bearish performance has seen Ether traders record over $96 million in long liquidations since Tuesday.
$ETH saw a rejection around the $2,100 resistance level on Saturday and has now dropped below the $2k psychological level.
The bearish trend could persist further and push $ETH towards the Friday low of $1,740.
The Relative Strength Index (RSI) and Stochastic Oscillator (Stoch) on the daily chartare around oversold territory, indicating a dominant bearish momentum.
However, if the $1,740 support level holds in the near term, $ETH could revisit the $2,100 resistance over the next few days.
Surpassing this resistance level could see $ETH rally towards the $2,380 February high.
The market conditions remain bearish, and this could impact $ETH’s recovery in the near term.
