Ethereum whales have increased their positions by $950 million: is a bottom forming for ether?
The price of Ethereum (ETH) has made a confident rebound of 22% from its June low, allowing the asset to consolidate above a key trend line closely watched by institutional investors. This rise coincided with a resumption of capital inflows into spot ETH ETFs, which had previously recorded sustained outflows for several weeks. This synchronization of two factors—a technical breakout and the return of institutional demand—creates the prerequisites for a shift in market sentiment.
Large holders, known as "whales," continued to actively accumulate the cryptocurrency even during the decline phase, as confirmed by recent on-chain data. However, the rapid growth in the volume of borrowed funds casts doubt on the stability of this success. Experts debate whether the market has formed a real bottom or if this is another false rebound within a global downtrend.
Ethereum Holds the Monthly VWAP Line Again
On June 14, the Ethereum exchange rate rose above the monthly VWAP (Volume-Weighted Average Price) line. For major players, this indicator serves as a dividing line between the accumulation and distribution phases of assets. Previous breakouts of this level led to similar results: after the April breakout above VWAP, the coin rose by 19%, while 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 indicates that institutions begin actively buying at the first signs of an upward trend.
Spot ETF Flows Turn Positive Again After a Tough Streak
The sentiment reversal came just in time. Literally the day after the exchange rate consolidated above the VWAP line, on June 15, net inflows into spot ETH ETFs amounted to $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, except for just two trading sessions. For comparison, the situation looked much better in early May: on May 1, funds attracted $101 million, and on May 5, another $98 million. The total volume of net assets under management is now approaching the $10.04 billion mark.
Whales Continue Buying, Signs of Capitulation Fade
Large investors began accumulating coins even before the chart crossed the VWAP line. Whales systematically increased their positions, completely ignoring the local price decline. According to analysts at Santiment, since June 10, the balances of millionaire wallets have grown from 124.85 million ETH to 125.4 million ETH. Thus, in just one week, they bought coins worth a total of about $950 million. Concurrently, on-chain metrics recorded a decline in seller activity. Mass panic in the market stopped around June 7, when the coin found a local low. It was then that the net change in positions on exchanges turned negative, signaling an outflow of coins from trading platforms.
This investor behavior indicates the transfer of cryptocurrency to cold wallets for long-term storage. This trend is supported by large whales, who promptly buy up any available volumes. As a result, a shortage of sellers has formed in the market, which usually heralds an imminent trend change. Analysts from Swissblock noted in their latest report that Ethereum has been in a capitulation phase for a long time. This state of strong market pressure often precedes a powerful reversal in quotes. The current reduction in exchange balances confirms that the acute phase of selling appears to be truly behind us.
Key Ethereum Levels
Currently, Ethereum is trading around $1,771, holding above the monthly VWAP, which is at the $1,705 level. Since the beginning of June, the coin has gained about 22% from its low of $1,507, but this is still insufficient for a final reversal. To confirm an upward trend, 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.
The main danger now lies in excessively high leverage. The total open interest in ETH futures has jumped from $8.86 billion to $9.96 billion, and at its peak exceeded $10.27 billion. Typically, a reliable foundation for growth forms only after the complete liquidation of excess leveraged positions. Currently, we are seeing the opposite process—open interest is rising along with the price. This situation indicates the dominance of margin traders rather than real demand in the spot market. Overloaded long positions could trigger a wave of forced liquidations at the slightest downward movement, so it is too early to talk about the end of capitulation.
My analysis: The accumulation of $950 million by whales is a powerful bullish signal, but it does not negate the risks associated with the overheated derivatives market. Until we see a decline in open interest or a confident breakout above $1,851, any rally will be speculative in nature. A true bottom will only form after margin positions are "cleaned out."