A recent on-chain analysis report revealed that the Ethereum price faces a serious threat of correction following a 90% drop in holder accumulation. Since mid-January, the volume accumulated by long-term investors fell from 338,708 ETH to a mere 40,953 ETH, weakening buyer conviction significantly in the face of current market volatility and macroeconomic uncertainty across the globe.
According to Ananda Banerjee, a market data specialist, the asset’s technical structure shows signs of exhaustion despite a 4.6% rebound in the last 24 hours. Although the price remains within a falling wedge formation, the lack of institutional buying suggests that this bounce lacks a solid foundation, exposing the asset to higher risks of imminent liquidation and further downside movement.
Weakness in On-Chain Indicators and Growing Sell Pressure
It is alarming that the NUPL indicator, which measures unrealized profits and losses, currently sits at 0.007, staying far from deep capitulation levels. On the other hand, exchange transfers jumped by 50% in a single day, proving that investors are selling the relief bounces in the short term, confirming a persistent distribution trend among traders who prefer liquidity over long-term holding.
For the market to reach a durable bottom, analysts suggest that the NUPL indicator should drop into negative territory, similar to the −0.22 recorded back in April 2025. Without this purging process, the Ethereum price lacks the necessary momentum for a real recovery, keeping uncertainty high and rising regarding whether the current support at $2,160 will be able to withstand the next bearish waves.
Furthermore, the gap between institutional and retail capital flows has become more evident during this first quarter of 2026. While speculative capital dominated the end of last year, institutional investors maintain a macro-cautious stance, prioritizing the preservation of existing capital over high-risk asset exposure, effectively limiting the bullish potential of the network for the foreseeable future during this cycle.
Is a Crash Toward the $1,500 Support Level Inevitable?
One cannot ignore that the technical chart highlights $2,250 as a critical base that must be held to avoid a major disaster. However, if the $2,160 level fails, the Ethereum price could seek the $1,540 region per unit, a historical retracement level that coincides with total holder capitulation, redefining the landscape for investors who are looking for a long-term entry point into the ecosystem.
On the other hand, to invalidate this bearish narrative, the leading smart contract blockchain needs to reclaim and consolidate above the $2,690 resistance. Only a sustained move above this mark would indicate that buyers have regained control of the market, allowing for a significant trend shift that would finally push the $1,500 ghost away from the current technical and fundamental projections.
Ultimately, the ecosystem is in a phase of “anxiety and denial” according to on-chain profitability metrics. Volatility is expected to persist as long as large-scale holders do not resume aggressive buying, leaving the door wide open for additional corrections that could take the token’s value to lows not seen since last year, demanding maximum caution from traders operating within the current digital asset market.
