Ethena (ENA) has been facing significant challenges in recent weeks, primarily due to large-scale sell-offs by whale investors. The token, which had experienced some fluctuations, recently saw a sharp drop in value, triggering concerns about its future price trajectory. Despite a brief resurgence in the last 24 hours, ENA remains vulnerable to further declines as investor confidence weakens.

Whale Activity and Market Pressure

Whales—investors holding large quantities of ENA—have been a significant factor in the recent price downturn. A notable sell-off occurred when a major investor, holding between 0.1% and 1% of the token’s total supply, liquidated $6.46 million worth of ENA. This move led to an immediate 9.84% price decline, which has continued in the following days. Data from Santiment shows that large holders, particularly those owning between 10 and 100 million ENA tokens, have been offloading substantial amounts, contributing to the ongoing market pressure.

The continuous activity of these whales has intensified selling sentiment and stifled any potential for a price recovery. According to IntoTheBlock, there were 224 significant transactions recorded in the past week, which marked the highest number in recent times. Collectively, these whales and large investors have offloaded over 50 million ENA tokens, valued at approximately $47.9 million. This massive sell-off has caused a ripple effect, impacting market sentiment and contributing to a broader bearish outlook.

Declining Market Sentiment

The selling pressure from whales has led to a notable increase in active addresses, suggesting that more retail traders may be following the lead of larger investors and offloading their ENA holdings as well. However, despite this uptick in trading activity, the number of active addresses remains significantly lower compared to the previous week. The data from IntoTheBlock reveals a 19.27% decrease in active addresses over the past seven days, indicating that market participation is waning, especially among smaller traders.

Additionally, new addresses created in the past week have dropped by 11.81%, further emphasizing the growing bearish sentiment surrounding ENA. These factors combined suggest that more traders are exiting their positions, and there is limited new interest in the asset. If this trend continues, ENA could face further declines in value as selling pressure intensifies.

Technical Outlook for ENA

From a technical standpoint, ENA has stalled in its recent attempt to recover, with its rally capped at the $0.9742 resistance level. This price point aligns with the Fibonacci retracement, which suggests that ENA’s recovery is struggling to gain momentum. Currently, ENA is approaching the $0.8784 support level, which will be crucial in determining whether the token can stabilize or if it will continue its downward trend.

If ENA fails to hold this support level, a more significant decline could follow, potentially bringing the token down to lower support levels at $0.7771 or $0.7234. Such a price movement would signal a loss of confidence among traders and may lead to further erosion in value.

Conclusion

In summary, ENA’s recent struggles are largely driven by large sell-offs from whales, combined with declining market sentiment. The token’s inability to maintain upward momentum has left it vulnerable to further price declines. If the selling pressure from both institutional and retail investors continues, ENA may struggle to hold key support levels, and the price could drop below $0.7, leading to further losses for holders.