Ether Retreats From $3,800 as Analysts Warn of Overheating, Despite Ongoing Whale Accumulation
Ethereum (ETH) saw a notable pullback on Tuesday, falling over 3% to $3,696 as the recent rally toward $4,000 showed signs of fatigue. While strong whale buying and institutional accumulation continue to support the broader uptrend, analysts are increasingly voicing concerns about overheated market conditions and a potential correction.
The decline follows two weeks of steady gains that had pushed ETH closer to the key $4,000 threshold. Analysts now caution that the rally may be entering a consolidation phase, citing signs of technical weakness and overstretched indicators.
Crypto analytics account Front Runners noted ETH’s 14-day outperformance over Bitcoin, calling the run “unsustainable without a reset.” The account also flagged an overheated RSI and euphoric sentiment among traders. Market analyst Michaël van de Poppe echoed the concern, pointing to a drop toward $3,650 and warning of a possible “violent correction.” Meanwhile, trader Andrew Crypto argued a healthy pullback is needed after ETH failed to break through a critical resistance zone.
Despite the bearish outlook from some quarters, bullish sentiment persists among others. On July 8, Crypto Rand predicted a move to $4,000 was “programmed,” highlighting growing confidence in the trend’s momentum. That conviction is further supported by robust on-chain activity.
According to CryptoQuant data cited by Crypto Rover, whale accumulation has reached record highs. Institutional buying continues to ramp up as well — SharpLink Gaming (NASDAQ: SBET), one of the largest public ETH holders, disclosed a purchase of 79,949 ETH last week, marking its biggest weekly buy since launching its crypto treasury in June. The company now holds 360,807 ETH and reported $96 million in capital available for further deployment.
While ETH remains relatively resilient amid macroeconomic headwinds, analysts say the next leg higher may require a shakeout. As Andrew Crypto put it, “A chart without a correction isn’t a healthy chart.”
At the time of writing, ETH trades at $3,696, down 3.44% over the past 24 hours, according to CoinDesk data.
Technical Analysis Highlights
- 24-Hour Performance: ETH dropped 6.11% from $3,851.59 to $3,623.60 between July 21 at 15:00 UTC and July 22 at 14:00 UTC, with a $228.15 intraday range.
- Volume Activity: Selling pressure intensified early July 22, with volume spiking to 353,275 units — well above the 24-hour average of 265,473 — as ETH fell from $3,731.37 to $3,656.39.
- Resistance Levels: Price was repeatedly rejected near $3,730–$3,740. A brief rebound lifted ETH to $3,698.04 before another wave of selling pushed it lower.
- Closing Weakness: ETH ended the session at $3,647.45, near its daily low, suggesting further downside pressure.
- Final Hour Breakdown: From 13:09 to 14:08 UTC, ETH dropped 1.25% ($46.31), with volume surging nearly 10x to 24,478 units at 13:32 UTC.
- Support Breaches: Key levels at $3,690, $3,670, and $3,650 were broken during heavy liquidation. ETH lost over $50 between 13:30 and 13:55 UTC alone.
- Failed Recovery: Attempts to reclaim $3,650–$3,670 failed, cementing the day’s bearish tone and leaving ETH vulnerable heading into the next session.
