Ethereum falls 2.4% to $1,872, whales accumulate as small holders sell

Ethereum registered a 2.4% decline to $1,872 on August 13 after briefly reaching a session high of $1,918. The sell-off followed the release of US Consumer Price Index (CPI) data, prompting profit-taking that erased the day’s earlier gains.

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Inflation data triggers pullback

July’s inflation report showed the headline CPI increased by 0.1% from the previous month and 3.4% year-over-year. The core CPI, excluding food and energy, rose 0.2% monthly and 2.5% annually. These numbers matched economists’ expectations, leaving no catalyst for further upward movement in digital assets.

Before the CPI announcement, Ethereum climbed to nearly $1,918, but encountered resistance as traders took profits. Breaking below the $1,887 level, a thin order book contributed to the rapid decline toward $1,872.

Meanwhile, Bitcoin remained steady near $64,000, reflecting a lack of significant reaction to inflation data among leading cryptocurrencies.

On-chain metrics point to distribution

Blockchain analytics indicated a shift toward distribution activity before the recent price decline. The 14-day moving average of ETH Exchange Netflow turned positive, signaling a modest increase in coins moving to exchanges. Total exchange holdings rose to 15.13 million ETH, a trend that has previously accompanied accelerated selling periods.

The Coinbase Premium Index fell to -0.081 despite improvements in US equity markets, suggesting a cautious stance among American crypto investors.

Wallet data revealed that smaller addresses holding between 100 and 10,000 ETH offloaded approximately 160,000 ETH over the past week, while larger wallets holding between 10,000 and 100,000 ETH accumulated roughly 100,000 ETH during the same period.

In the past week, larger Ethereum holders absorbed about 100,000 ETH, while smaller addresses reduced their positions by around 160,000 ETH, indicating a divergence in market sentiment between retail and institutional participants.

Spot Ethereum ETFs in the United States saw net inflows of $244.9 million last week, followed by modest outflows of $8.9 million in the first days of this week.

CryptoGoos, a digital asset analyst, noted that ETH’s latest low coincided with declining distribution from long-term holders and renewed accumulation. This price action, forming a higher low, is characterized as a potential bullish divergence.

Key technical levels and market outlook

Technical analysis shows Ethereum consolidating near the $1,875 zone, seen as a last line of support by chart watchers. The daily Chaikin Money Flow indicator measured -0.04, suggesting a moderate tilt toward distribution. The 4-hour Relative Strength Index printed 45.15, remaining below the neutral 50 level and signaling weak momentum.

CoinGlass liquidation heatmap data indicated significant leverage buildups between $1,945 and $1,955, while notable downside liquidation clusters formed near $1,850 and $1,835.

Market participants said recapturing the $1,920 level is crucial for any meaningful rebound toward $2,000. Analyst Daan Crypto Trades identified 0.03 BTC on the ETH/BTC pair as an important threshold for potential outperformance versus Bitcoin.

Recapturing $1,920 is key for Ethereum to resume an upward trajectory, with further resistance likely around $2,000 and above.

MorenoDV, an analyst at CryptoQuant, observed that Ethereum’s Net Unrealized Profit/Loss metric on Binance is nearing -0.35, a mark seen at prior market bottoms during late 2019, March 2020, and throughout 2022.

At last check, Ethereum traded around $1,879, maintaining its position above the 20-day exponential moving average of $1,884 and the 50-day EMA at $1,865.

Mini dictionary: Chaikin Money Flow (CMF) – A technical indicator that measures the volume-weighted average of accumulation and distribution over a specific period, helping identify buying or selling pressure in an asset.