Ethereum (ETH) Price Faces Profit-Taking Risk as 88% of Supply Turns Green

Ethereum Price Faces Profit-Taking Pressure as Majority of Supply Remains in Profit

Ethereum’s recent rally above the $3,000 mark is encountering increasing resistance amid signs of potential short-term weakness. On-chain metrics and trading volume patterns indicate that unless key resistance levels are decisively breached, the cryptocurrency may face profit-taking pressures that could temper its upward momentum.

High Percentage of Ethereum Supply in Profit Raises Caution

Data from Glassnode as of July 14 reveals that approximately 88.57% of Ethereum’s circulating supply is currently in profit, with the price near $3,013. Historically, such elevated levels of profitable holdings have often preceded short-term corrections, as investors seek to realize gains. The Percent Supply in Profit metric, which measures the proportion of ETH acquired below the current market price, has surged to levels typically observed at local market tops or following overheated rallies, signaling a potential risk of retracement.

Whale Transactions and Volume Patterns Signal Increased Downside Risk

Market concerns have been amplified by recent large-scale transactions from Ethereum whales. One notable transaction involved the transfer of $237 million worth of ETH to exchanges, a move commonly interpreted as preparation for selling. Additionally, whales collectively sold $321 million in ETH within a 60-second window, intensifying sell pressure and contributing to a descending price channel. These developments, coupled with the breach of a significant multi-year support level, have raised the possibility of a price decline of up to 25% should selling accelerate.

Further undermining the price strength is a bearish divergence observed in the On-Balance Volume (OBV) indicator. Despite Ethereum’s price appreciation from June 11 to July 14, OBV formed a lower high, suggesting diminished trader participation in the rally. This divergence points to weakening accumulation and growing selling pressure beneath the surface, casting doubt on the sustainability of the recent price gains.

Critical Support and Resistance Levels Define Near-Term Outlook

Ethereum recently encountered resistance at $3,079 and is currently consolidating around $2,981. Immediate support levels correspond to the 0.236 Fibonacci retracement at $2,853 and the 0.382 level at $2,713. More significant support zones lie at $2,600 (0.5 Fibonacci level) and $2,487 (0.618 Fibonacci level). A decisive break below these critical levels would indicate a shift toward a bearish market structure. Conversely, maintaining support above $2,713 would preserve the broader bullish outlook.

Outlook: Cautious Optimism Amid Elevated Risks

A sustained break and close above the $3,079 resistance, accompanied by a rising OBV, would invalidate the short-term bearish scenario and could open the door for renewed buying interest and higher prices. Until such a development occurs, the combination of elevated profit-taking, significant whale activity, and volume divergence suggests that traders should approach the market with caution as Ethereum navigates historically saturated profit levels and mounting downward pressure.