ETH drops below 2900: increased short positions, net capital outflow

Ethereum( ETH) fell below the key support level of 2900 USDT in the past 24 hours, with the current price at 2899.31 USDT. This is not an isolated event but a continuation of recent sustained decline. According to the latest news, ETH has already decreased by 12.85% over the past 7 days, and market sentiment has clearly weakened. Meanwhile, bearish forces are strengthening, ETF funds are continuously flowing out, and the complex movements of on-chain large holders also reflect market indecision.

Multiple Dimensions of Price Decline

Based on the latest data, ETH’s recent performance is as follows:

From the data, this wave of decline mainly concentrated in the past week, with a drop close to 13%, indicating the market experienced a noticeable adjustment in recent days. The 24-hour trading volume was $997 million, down 27.77% from the previous day, with trading activity significantly decreasing, which usually suggests reduced market participation.

Market Sentiment Clearly Weakening

Bearish forces are strengthening

According to on-chain monitoring data, a whale address known as the “Air Force Commander” has recently significantly increased its short positions. Last night and this morning, this address rolled over short positions in multiple tokens including BTC and ETH, with ETH short holdings rising from $96.1 million to $106 million, at an average price of $3,067. This indicates that short sellers are increasing their bets, expecting prices to continue falling.

ETF funds continue to net outflows

The performance of Ethereum spot ETFs also reflects market sentiment. According to the latest data, on January 22nd Eastern Time, Ethereum spot ETFs experienced a net outflow of $41.9772 million, marking the third consecutive day of net outflows. Among them, the BlackRock ETF( ETHA) had the largest single-day net outflow of $44.4437 million. This suggests institutional investors are reducing their ETH allocations.

( Overall decline in the crypto market

In a broader context, the entire crypto market is trending downward. According to the latest news, the overall crypto market sector is in decline, with only the GameFi, AI, and RWA sectors remaining relatively resilient. This indicates that ETH’s decline is not an isolated case but a reflection of decreased market risk appetite.

On-Chain Movements Reveal Complex Signals

Interestingly, the behavior of on-chain large holders shows market indecision. On one hand, Bitmine) Tom Lee’s associated address has continued to increase ETH staking, with the latest staking of 171,000 ETH, bringing the total staked to 1,943,200 ETH, worth $5.71 billion. This suggests long-term bullish investors are still deploying.

On the other hand, there are signs that some holders are reducing their positions. According to the latest news, an address redeemed 6,300 ETH### worth $18.63 million( from Renzo and then transferred it to Coinbase, suspected of selling. Meanwhile, Metalpha withdrew 8,500 ETH, valued at $24.85 million, from Kraken and Binance. These movements imply some large holders may be gradually exiting or adjusting their positions.

Key Support Levels to Watch

From a technical perspective, $2,855 is a major support level recently. If ETH continues to decline and breaks below this level, it could trigger more selling pressure. The resistance level is at $3,202; a rebound would require breaking through this zone to change the short-term trend.

Summary

ETH breaking below 2900 USDT is a concrete reflection of weakening market sentiment. Bearish forces are strengthening, institutional ETF outflows are ongoing, and overall market risk appetite is declining. These factors collectively drive the price downward. However, the complex movements of on-chain large holders also remind us that the market includes both short-sellers increasing their positions and long-term holders holding firm. Currently, the advantage appears to be with the bears. The key going forward is to observe whether the market can hold above support levels and monitor the subsequent actions of large holders.