- Ethereum shows lowest daily RSI and heavy liquidations, signaling a potential bottom zone.
- Smart money accumulates over 400,000 ETH while public sentiment remains deeply bearish.
- Reduced leverage and negative funding create conditions for a strong market rebound.
Ethereum — ETH, traders feel the market’s chill after a sharp pullback, yet a quiet strength builds beneath the surface. Prices recently dipped near $3,800, shaking out overleveraged positions and stirring anxiety across exchanges. Beneath the gloom, vital signs hint at a brewing reversal. Key metrics and shifting sentiment now outline a bottoming zone, offering disciplined buyers a chance to scale in before momentum turns.
The Numbers Behind the Floor
Fresh data paints a compelling picture of resilience. The daily Relative Strength Index shows the lowest reading since the $1,350 tariff scare, a level historically tied to significant rebounds. Negative funding on the one-day chart strengthens the signal. Six of the past seven negative funding events marked pivotal lows during an uptrend. Price has also revisited the weekly breakout area near $3,850, reinforcing the idea of a technical floor.
The derivatives market adds another clue. Profit taking surged on Friday, with investors realizing over $800 million as Ethereum slid below $4,000 for the first time in a month. Massive long liquidations followed—$401.8 million on Thursday and $490 million on Tuesday—erasing excess leverage. Binance recorded a $3 billion wipeout on Tuesday and an extra $1 billion the next day. Bybit saw $1.2 billion disappear, while OKX shed $580 million.
These heavy liquidations resemble a storm clearing the sky. Excess leverage has drained away, leaving a healthier market structure. A CryptoQuant report confirms one of the steepest open interest resets since early 2024. Reduced leverage often precedes calmer conditions, a key ingredient for recovery.
Sentiment Turns Dark as Smart Money Accumulates
While charts flash opportunity, public mood sinks lower. Social feeds overflow with gloomy predictions and talk of deeper declines. Fear hangs like a heavy fog, a classic hallmark of capitulation. Paradoxically, that despair often signals the dawn of a rebound. When most voices expect pain, patient investors quietly prepare for the next surge.
Evidence of quiet accumulation strengthens that narrative. Smart money tracker Lookonchain reports fifteen wallets gathering 406,117 ETH—worth around $1.6 billion—from major venues such as Kraken and Galaxy Digital over the past two days. Two long-dormant addresses also moved 200,000 ETH, showing that whales remain engaged. The original holder still commands 736,316 ETH across eight wallets, valued near $2.89 billion.
These moves resemble seasoned sailors hoisting sails while others run for shore. Combined, data and sentiment reveal a market primed for renewal. The goal is not to catch a single perfect candle. The wiser strategy is to identify a range, a bottoming zone, and scale entries over several days as price steadies.
