ETH showed a strong recovery after falling to $950. But a bearish continuation setup in ETH/USD could make it come back.
Ethereum’s native token Ether (ETH) dropped to $950 on Uniswap — a decentralized crypto exchange — on June 13, about 20% below its spot price on other exchanges.
Hourly ETH/USD chart. Source: Uniswap
Over $130M ETH Sold in Six Hours
The incident took place around 3:00 AM UTC after the whale offloaded 65,000 ETH for several stablecoins including USD Coin (USDC), Tether (USDT) and Dai (DAI).
One piece of evidence suggests that the whale sold his ETH holdings to pay off nearly $73 million in debt with Oasis.app, a DeFi lending platform. The duration of the sell-off caused the liquidation price of ETH to drop from $1,200 to $875.
Borrower Oasis continued the sell-off by throwing another batch of nearly 28,000 ETH five hours after the initial sell-off to pay off another $32 million of debt. This time, the liquidation price increased from $892 to $1200 as shown below.
Screenshot of the personal account of an anonymous borrower. Source: Oasis.app
As a result, the whale lost about 93,000 ETH in just six hours. The amount is approximately $112 million at the ETH/USD exchange rate on June 13th.
Interestingly, the total outstanding debt of the Oasis borrower was approximately $120 million (measured in the DAI stablecoin), suggesting that the whale suffered serious “slippage” losses.
Ethereum Price to Rise to $667 – Veteran Analyst
Ether’s path to $950 was short-lived, indicating reasonable demand for tokens near the level. However, a separate analysis by experienced trader Peter Brandt showed that the price of ETH will drop to $650 in the coming weeks.
Brandt’s bearish outlook arose from a classic continuation pattern called a “descending triangle” that resolves after price breaks in the direction of its previous trend.
As the ether fell before the triangle formed, its path of least resistance was shifted to the downside.
Daily ETH/USD chart. Source: Peter Brandt/TradeNavigator
Brandt says ETH hit the first triangle decline target of $1,268 when the price dropped 20% on June 13th. He expects the decline to continue, with ETH falling another nearly 50% to $667.
However, the Relative Strength Index (RSI) of Ethereum being oversold can lead to a sharp price reversal. Ethereum is getting further bounce hints from its 200-week simple moving average (200-week SMA; orange wave in the chart below) around $1,200, which is now serving as support.
Weekly ETH/USD price chart. Source: Trading View
If the price of ETH suffers an upward pullback, then the token’s tentative bullish target could be around $1,450, which coincides with the 1.00 Fibonacci line on the Fibonacci retracement chart, stretching from a swing high around $1,450 to a swing low of $84. .
Related: Celsius Exodus: $320M Cryptocurrency Sent to FTX, User Withdrawals Suspended
Conversely, a critical close below the 200-week SMA could see ETH look at $920 as its next downside target.
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