• Ethereum experiences its second-largest buying day, with long-term holders accumulating significantly.
• Market indicators show mixed signals, with decreases in open interest and exchange reserves hitting an eight-year low.

Ethereum [ETH], the second-largest cryptocurrency by market capitalization, has recently exhibited some interesting market movements.

Despite an 8% decline over the past week, Ethereum saw a slight uptick of 0.3% in the last 24 hours, bringing its current trading price to $3,519.

This minor increase comes during a period of overall market uncertainty, particularly following the approval of spot Ethereum ETFs by the U.S. Securities and Exchange Commission in May.

Long-term holders capitalize on market dips

Amid these price adjustments, Ethereum has experienced a significant surge in long-term holder accumulation. According to Julio Moreno, CryptoQuant’s head of research, Ethereum just witnessed its second-largest buying day by long-term holders. 

On June 12, about 298,000 Ethereum tokens, valued at approximately $1.34 billion, were purchased by these steadfast investors, capitalizing on a slight 2% price dip within the same 24-hour period.

This noteworthy accumulation was not far off from the record set on 11th September, 2023, when 317,000 Ether tokens were acquired as prices dipped below $1,600.

This pattern of strategic buying during price drops highlights the confidence long-term investors have in Ethereum’s value. 

Furthermore, this trend corresponds with an increase in large transactions over $100,000, as shown in IntoTheBlock data, where such transactions rose from below 4,000 earlier in the week to over 6,000

This indicates active accumulation by whales regardless of the prevailing market conditions.

Market caution and technical outlook

However, contrasting this bullish accumulation activity, Ethereum’s market metrics such as open interest and trading volume present a more subdued outlook. 

Open interest in Ethereum has decreased by nearly 2% to $15.41 billion, while trading volume saw a significant decline of 25.77%, now standing at $24.19 billion. These metrics suggest a cautious stance among some market participants, potentially anticipating further price adjustments.

On the technical front, Ethereum’s inability to surpass its March highs has activated a sell setup on its daily chart, hinting at possible continued downward pressure.

However, a shorter-term perspective from the 4-hour chart suggests there might be a temporary rise to around $3,800, potentially providing liquidity for an ongoing downtrend.

Read Ethereum’s [ETH] Price Prediction 2024-25

In another vital aspect of market dynamics, the amount of Ethereum held on exchanges has hit an eight-year low, as noted by AMBCrypto.

This reduction in exchange-held Ethereum, coupled with the launch of spot ETFs, may lead to a significant supply shock, which could, in turn, trigger a sharp price increase.