Ethereum (ETH) has faced a turbulent few months, underperforming relative to other major cryptocurrencies and sparking debate among investors about its future trajectory. After a sharp 57% drop from $4,100 in December to $1,750 by mid-March, many are questioning whether this is a sign of long-term weakness—or a rare buying opportunity ahead of a potential rebound.
On-chain analyst Ali Martinez has provided valuable insights into Ethereum’s current market dynamics, analyzing key metrics that could signal either further downside or an imminent recovery. His findings offer a data-driven perspective for traders and long-term holders alike who are assessing whether now is the right time to buy ETH.
Ethereum’s Recent Price Decline and Market Sentiment
The steep decline in ETH’s price over the winter months pushed investor sentiment firmly into fear territory. According to Martinez, such a dramatic pullback naturally triggered widespread selling pressure—even among large holders known as "whales."
One telling metric is the drop in the number of addresses holding more than 10,000 ETH. This figure fell from 999 in mid-February to just 919 by early March, indicating that even the most confident investors were liquidating portions of their holdings.
In the week ending March 17 alone, over 130,000 ETH exited whale wallets, signaling strong distribution activity. Compounding this trend, more than 100,000 ETH were moved to centralized exchanges between March 11 and 13—typically a precursor to selling.
Additionally, U.S.-listed spot Ethereum exchange-traded funds (ETFs) have seen outflows totaling $760 million in the past month, reflecting lukewarm institutional demand during this downturn.
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Technical Analysis: Support Levels and Bearish Patterns
From a technical standpoint, Ethereum’s chart structure presents both risks and potential turning points.
On the three-day timeframe, ETH formed an ascending triangle—a pattern often associated with continuation or breakdown depending on breakout direction. In this case, the configuration suggests a possible plunge toward $1,000 if downward momentum accelerates.
Meanwhile, a break below a parallel channel on the daily chart hints at a target near $1,250. More immediate downside targets include $1,440, which has emerged as a critical support zone based on historical pricing bands.
However, Martinez emphasizes one key level above all: $1,887. This price point represents a major cost-basis accumulation zone where investors previously bought approximately 1.63 million ETH. As long as ETH holds above this level, the bearish outlook remains questionable.
Conversely, failure to defend $1,887 could open the door to deeper losses, with subsequent targets at $1,440, $1,250, and potentially even $1,000.
On the upside, resistance looms at $2,250 and $2,610. A confirmed breakout above these levels would invalidate much of the current bearish technical structure and could reignite bullish momentum.
Signs of a Market Reversal: Whales Accumulate and Exchanges See Outflows
Despite the earlier wave of selling, recent on-chain data reveals a shift in behavior that may signal growing confidence among large players.
Martinez highlighted that ETH whales accumulated 470,000 ETH last week—a significant reversal from prior weeks of distribution. This kind of strategic buying often precedes price recoveries, especially when executed by informed market participants.
Even more telling is the movement of ETH off exchanges. Over the last 48 days, traders have withdrawn 1.2 million ETH from exchange wallets—a strong indicator that holders are moving their assets to private storage, commonly interpreted as a sign of long-term conviction.
When supply tightens on exchanges and large investors accumulate, upward price pressure tends to build. This dynamic appears to already be taking effect: ETH has gained nearly 10% in the past week, trading above $2,090 at the time of writing.
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FAQ: Your Burning Questions About Buying ETH – Answered
Q: Is Ethereum still a good long-term investment despite recent losses?
A: Yes, many analysts believe Ethereum remains a core holding due to its dominant position in decentralized applications, DeFi, and smart contracts. While short-term volatility is expected, its underlying utility supports long-term value.
Q: What does whale accumulation mean for retail investors?
A: When whales buy in large volumes, it often reflects confidence in future price appreciation. Retail investors can view this as a positive signal—but should always conduct independent research before investing.
Q: Could ETH really fall to $1,000?
A: While technically possible in a worst-case scenario, such a drop would likely require broader market collapse or systemic risk. With strong support at $1,887 and increasing accumulation, a move to $1,000 seems increasingly unlikely unless macro conditions deteriorate sharply.
Q: How do exchange outflows affect ETH’s price?
A: Fewer coins on exchanges mean reduced immediate selling pressure. When supply decreases relative to demand, prices tend to rise—especially when combined with growing investor confidence.
Q: What are the key resistance levels to watch for ETH?
A: The most important resistance zones are at $2,250 and $2,610. A sustained break above these levels would suggest renewed bullish momentum and could attract fresh institutional buying.
Q: Should I buy ETH now or wait for a lower price?
A: Timing the bottom is difficult. Dollar-cost averaging (DCA) into positions allows investors to reduce risk while building exposure over time—especially useful in volatile markets like crypto.
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Final Thoughts: A Turning Point for Ethereum?
While Ethereum’s recent performance has been disappointing for some investors, the latest on-chain trends suggest a potential shift in market dynamics. Whale accumulation, exchange outflows, and stabilization above key support levels indicate that selling pressure may be subsiding.
The path forward will depend heavily on whether ETH can defend the $1,887 support zone and eventually break through resistance at $2,250 and beyond. For those considering entry points, current conditions may represent a strategic window—especially with growing evidence of institutional re-engagement and long-term holder confidence returning.
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Ultimately, while short-term risks remain, Ethereum’s foundational role in the blockchain ecosystem continues to make it one of the most compelling digital assets for both speculative and value-oriented investors. As always, prudent risk management and continuous monitoring of on-chain signals will be essential in navigating what could be a pivotal phase in ETH’s 2025 journey.