Ethereum Drives $1.1 Billion Crypto Market Liquidation, Analysts Eye ‘Buy the Dip’ Opportunity

Ethereum leads the crypto market with $1.99M in trading volume, outperforming other assets in the latest market shift.

The crypto market saw another wave of liquidations, crossing $1.1 billion in the last 24 hours. Ethereum (ETH) once again led the market, contributing $409 million in liquidations. The sell-off sent ETH prices below $3,850, wiping out many leveraged positions. 

Despite a 20% drop from its peak, analysts are eyeing potential ‘buy the dip’ opportunities, particularly for Ethereum.

Ethereum Leads Liquidations Amid Market Sell-Off

Ethereum was the primary driver of the latest crypto market downturn, accounting for the largest share of liquidations.

According to data from Coinglass, ETH’s liquidations amounted to $409 million. Bitcoin (BTC) followed with $272 million in long liquidations, reflecting a broader market pullback.

The sell-off has been fueled by several factors, including a rise in leveraged positions and heavy outflows from spot Ether ETFs.

Investors have been quick to exit positions, fearing further price declines. The ETH price dipped significantly, triggering automatic liquidations of long positions, and increasing market volatility.

ETF Outflows and Institutional Sentiment

Ether ETFs have experienced significant outflows, with more than $250 million withdrawn in the past 24 hours. 

Fidelity’s FETH saw the largest outflow, with $158 million exiting its fund. This sharp outflow points to weakening institutional sentiment around Ethereum, despite the launch of the first Ether staking ETF.

The lack of positive momentum from the staking ETF highlights the current challenges Ethereum is facing. Even with this new investment vehicle, the market remains cautious. The outflows indicate that institutional investors are growing more risk-averse amid the ongoing price correction.

Analysts Eye ‘Buy the Dip’ Opportunities

Despite the recent market volatility, some analysts see Ethereum’s dip as an opportunity to buy. Crypto analyst Ted Pillows pointed out that Ethereum is holding key support around $3,822. If ETH breaks below this level, the price could dip further, reaching the $3,700 to $3,750 range.

On the other hand, analysts like Michael van de Poppe have pointed to signs that Ethereum may be nearing the bottom of its correction. 

Van de Poppe highlighted technical signals such as the gap with the 20-day exponential moving average (EMA). These signals suggest the market may soon stabilize, making Ethereum a potential buy for investors willing to ride out the volatility.

While some investors are cautious, others are positioning themselves to take advantage of Ethereum potential recovery. The current price action could present a short-term buying opportunity if the market finds support at these levels. 

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