After hitting a 3-month low of $1,522 on June 6, Ethereum (ETH) has recovered meaningfully, trading at roughly $1,878 as of Thursday. Adding to the optimism, latest on-chain data suggests that ETH large whales are finally in profitability, a state that has historically laid the foundation for a rally.
Ethereum whales re-enter profitability state
ETH whales – holding 100,000 or more ETH in their wallets – have returned to a profitable state following a prolonged period of being in the negative territory. The following chart shows the transition, as anticipation for a full-blown bullish rally builds.
Even if there isn’t a full-blown rally, a short-term rebound is definitely on the cards for ETH. The next major resistance level for ETH lies around the $2,400 area.
Historically, there have been very few instances when ETH whales have been in a state of unrealized loss. In fact, these wallets have only ever been close to losses when ETH was about to make a market bottom.
In stark contrast, when ETH whales returned to a state of profitability, such periods have coincided with rapid price appreciation. Further, the whale holding ratio is also at its highest level in history.
For the uninitiated, the whale holding ratio measures the proportion of an asset’s circulating supply held by large investors – referred to as whales. A rising whale holding ratio suggests that large holders are accumulating more of the asset, while a declining ratio may indicate distribution or reduced exposure.
Meanwhile, crypto analyst Gert van Lagen shared a more ambitious prediction about ETH, saying that on the biweekly chart, the cryptocurrency is bouncing from the bottom of the expanding diagonal structure, with a potential target between $12,000 to $20,000.
ETH looks to conquer $2,000
As ETH steadily inches closer to the psychologically important $2,000 level, capital inflows to ETH exchange-traded funds (ETFs) are becoming increasingly noticeable. ETH’s strong performance against BTC has also raised hopes for a looming altcoin season.
From a liquidity perspective, the majority of ETH liquidity still remains to the upside. However, there is also a cluster of liquidity around the $1,450 area, meaning that the digital asset may take a slight dip before resuming its uptrend toward $2,000.
On Monday, ETH also flashed a rare SuperTrend indicator. Historically, the digital asset has printed this bullish indicator only twice, resulting in rallies to the tune of 72, and 177 percent, respectively.
