Ethereum whales have increased their positions by $950 million: is the market preparing for a reversal?
The price of Ethereum (ETH) has rebounded 22% from its June low, managing to hold above a key trend line closely watched by institutional investors. This momentum coincided with renewed inflows into spot ETH ETFs, which had previously recorded sustained capital outflows for several weeks. This alignment of signals deserves close attention.
Large holders continued to actively accumulate the cryptocurrency even during the height of the decline, as confirmed by recent on-chain data. However, the rapid growth in the volume of borrowed funds raises doubts about the stability of the current success. Experts debate whether the market has formed a real bottom or if this is another false bounce within a global downtrend.
Return to VWAP: An Institutional Signal
On June 14, the Ethereum exchange rate rose above the monthly VWAP (Volume-Weighted Average Price) line. This indicator serves as a dividing line for major players between the accumulation and distribution phases of assets. Previous breaks of this level led to similar results: after the April breakout above VWAP, the coin rose by 19%, and the May breakout brought a more modest 7% gain.
Notably, in both cases, capital inflows into spot ETFs resumed a few days after the breakout. This dynamic suggests that institutions begin actively buying at the first signs of an uptrend. Although it is difficult to establish a direct causal relationship, the correlation repeats regularly, so investors should closely monitor fund statistics.
ETFs: A Shift in Sentiment After a Tough Streak
On June 15, net inflows into spot ETH ETFs totaled $22.5 million. This positive result broke an extremely painful series of declines: from May 11 to June 12, capital outflows were recorded almost daily, with only two trading sessions as exceptions. For comparison, the situation looked much better in early May: on May 1, funds attracted $101 million, and on May 5, another $98 million.
Currently, the total net assets under management are approaching the $10.04 billion mark. The recovery in May also began with small amounts, which then grew into a string of successful days. Therefore, if a market bottom is confirmed, we could see a repeat of this positive scenario. However, relying solely on ETFs would be a mistake, as key processes are now occurring directly on-chain.
Whales Accumulate, Capitulation Subsides
Large investors began accumulating coins even before the chart crossed the VWAP line. Since June 10, the balances of millionaire wallets have increased from 124.85 million ETH to 125.4 million ETH. Thus, in just one week, they purchased coins worth a total of approximately $950 million.
Simultaneously, on-chain metrics recorded a decline in seller activity. Mass panic in the market subsided around June 7, when the coin found a local bottom. It was then that the net change in exchange positions turned negative, signaling an outflow of coins from trading platforms.
This investor behavior indicates a transfer of cryptocurrency to cold wallets for long-term storage. This trend is supported by large whales, who are quickly buying up any available volumes. As a result, a shortage of sellers has formed in the market, which usually heralds an imminent trend change.
Analysts at Swissblock noted in their recent Altcoin Vector report that Ethereum has been in a capitulation phase for a long time. This state of intense market pressure often precedes a powerful price reversal. The current reduction in exchange balances confirms that the acute selling phase appears to be truly behind us. Nevertheless, the overall picture is significantly marred by the situation in the derivatives market.
Key Ethereum Levels
Currently, Ethereum is trading around $1,771, holding above the monthly VWAP, which is at $1,705. Since the beginning of June, the coin has gained about 22% from its low of $1,507, but this is still insufficient for a definitive reversal.
To confirm an uptrend, buyers need to close a daily candle above the resistance at $1,851. This would allow the asset to return to its previous trading range. If a decline begins, the first support will be the $1,624 level, with the critical point being the low of $1,507. A daily close below this mark would force the market to seek new lows. Only a confident break above the $1,851 barrier will help distinguish a true bottom from a temporary bounce.
My expert opinion: The current picture resembles classic accumulation before a major move. However, the overheated futures market is a ticking time bomb. If large players decide to test liquidity, we could see a sharp sell-off to $1,500 before a real bull run begins. Be cautious with leverage.