Ethereum (ETH) has recently seen a significant profit-booking spree by one of its largest holders. Since March, this giant whale has sold over 55,000 ETH, cashing in on the cryptocurrency’s periodic price spikes. Despite these sell-offs, the whale still holds a substantial amount of Ethereum, while the broader market grapples with price volatility and selling pressure.

The Whale’s Profit-Booking Strategy

This particular Ethereum whale has been methodically capitalizing on the recent ETH price increases. According to blockchain analytics platform Spot on Chain, the whale purchased a total of 96,639 ETH from Coinbase during the crypto winter of September 2022. This accumulation occurred when ETH prices were significantly lower, setting the stage for massive profits during the subsequent bull runs.

In March 2024, as Ethereum’s price surged, the whale began offloading its holdings, selling 55,000 ETH at an average price of $3,199, raking in $176 million. This strategy continued as the whale moved another 25,000 ETH, valued at $74 million, to Kraken over the past month. The most recent transaction saw 15,000 ETH sold at an average price of $2,645, just hours before ETH’s price dropped by 2.5% to $2,591.

ETH Price Faces Ongoing Selling Pressure

Ethereum’s price has struggled to maintain its upward momentum, repeatedly facing resistance at the $2,600 level. The market has been under selling pressure, partly due to the whale’s profit-taking activities. This pressure has been exacerbated by technical patterns, such as the formation of death crosses, which typically signal potential bearish trends.

Popular trader Peter Brandt has noted that Ethereum will likely remain defensive unless it can break through the $3,050 level. This resistance point has become a critical barrier for ETH, with repeated rejections preventing the cryptocurrency from gaining a more substantial foothold.

On-Chain Data and Market Outlook

The Ethereum whale’s activities have had a noticeable impact on the market, with ETH prices reacting to each significant sale. Despite the ongoing sell-offs, the whale still holds 41,639 ETH, valued at approximately $107 million. This remaining balance, purchased at a much lower price during the crypto winter, still represents an 86% profit, underscoring the effectiveness of the whale’s strategy.

However, the broader market conditions are less favorable. Ethereum’s gas fees have dropped to a five-year low, which has led to a decrease in the burn rate of ETH coins. This lower burn rate contributes to an increasing supply of ETH, which can negatively impact its price. Additionally, spot Ethereum ETF outflows have continued for the fourth consecutive trading session, indicating that institutional investors may also be reducing their exposure to ETH.

What’s Next for Ethereum?

As Ethereum continues to face selling pressure, the market’s direction will largely depend on whether it can break past the $3,050 resistance level. A sustained move above this level could signal a reversal of the current downtrend, potentially leading to a more bullish outlook for ETH.

On the other hand, if ETH fails to overcome this resistance, the market could see further declines, especially if more large holders like the aforementioned whale decide to take profits. The combination of technical resistance, increased supply, and waning investor sentiment suggests that Ethereum’s near-term future could be challenging.

Investors should monitor these key levels and on-chain metrics closely. While the whale’s profit-taking has been a significant factor in recent price movements, broader market dynamics will ultimately determine whether Ethereum can recover or continue its downward trend.