Ethereum (ETH) has been showing signs of recovery as a large whale accumulates a significant amount of ETH, but the broader market sentiment remains uncertain. Despite aggressive buying from major investors, Ethereum’s price continues to struggle below the $2,000 mark, raising questions about whether this whale action can help ETH recover.

Ethereum Sees Negative Netflow, Indicating Accumulation

Ethereum’s price has been fluctuating in recent days, with the token briefly reclaiming $2,000 before dropping below this level again. Over the past three days, Ethereum has experienced a negative netflow of over 150,000 ETH on derivative exchanges, according to data from CryptoQuant. This large outflow indicates a reduced selling pressure, as many investors are moving their ETH tokens to cold storage or decentralized finance (DeFi) platforms.

Such a significant outflow is often seen as a sign of accumulation, with investors — particularly large entities — holding onto their ETH in anticipation of future price increases. The move suggests growing confidence in Ethereum’s long-term prospects, as market participants seek to buy at what they perceive to be a discounted price.

Whale Buying: A Bullish Signal?

The most notable sign of this accumulation trend comes from a whale transaction that recently occurred. According to Onchain Lens, a whale withdrew 8,313 ETH, worth $16.46 million, from Binance after a two-month period of inactivity. This transaction increased the whale’s total ETH holdings to 11,197 ETH, which is now valued at approximately $22.17 million. Whale accumulation often signals bullish sentiment, as large investors typically believe the asset is undervalued at current prices and expect it to rebound in the near future.

Sustained buying activity from smart money investors like whales can positively influence the broader market, boosting confidence among other traders and attracting speculative buying. As whales accumulate, their actions often lead to a stronger sense of optimism, and their confidence in future price movements can sometimes fuel broader market demand.

ETH Struggles Despite Whale Activity

Despite the rising whale accumulation, Ethereum’s price has remained under pressure. After briefly breaking above the $2,000 threshold, ETH once again dropped below this level, hitting a low of $1,963. This suggests that a significant portion of the market remains bearish, and many participants are skeptical of a full price recovery.

AMBCrypto has noted that Ethereum’s Fund Market Premium has remained negative throughout the past week, suggesting that investors are closing positions faster than new buyers are entering. This pattern reflects a preference to sell ETH at a discount rather than hold for future gains. The ongoing selling pressure indicates that Ethereum still faces significant resistance in pushing higher.

Bearish Sentiment Among U.S. Institutional Investors

The bearish sentiment is particularly pronounced among U.S. institutional investors. The Coinbase Premium Index, which measures the price difference between the Coinbase spot price and the broader market, has dipped to -0.05. This negative reading reflects active selling by Coinbase investors, particularly among institutional traders, signaling a lack of confidence in Ethereum’s short-term outlook.

While the whale accumulation activity suggests that some market participants are optimistic about ETH’s potential, the broader sentiment remains weak, especially among institutional buyers. The increased selling activity and lack of strong buying interest from institutional players are putting downward pressure on Ethereum’s price.

The Path Forward for Ethereum

Despite the whale accumulation and reduced selling pressure, Ethereum is likely to continue facing challenges in the short term. ETH’s price has remained confined within a narrow range, fluctuating between $1,862 and $2,100. This suggests that the market is still uncertain about Ethereum’s near-term prospects.

While whale buying activity and negative netflows may indicate a potential for long-term growth, Ethereum will need to overcome broader market skepticism, especially from institutional investors, before a sustained price recovery can occur. Traders and investors will be closely watching for any shifts in sentiment or significant news that could help trigger a breakout for ETH. Until then, Ethereum may remain trapped in a consolidation phase as both buyers and sellers continue to vie for control of the market.