Ethereum (ETH) fell below $4,000 in early Asian trading today, hitting a nearly seven-week low. The sharp decline triggered notable liquidations, further denting traders’ portfolios.

Furthermore, in September, the second-largest cryptocurrency has displayed heightened volatility, with whale activity split between aggressive buying and selling.

BeInCrypto Markets data showed that the altcoin reached a low of $3,965—its weakest level since early August. This drop came amid a broader downtrend that has dragged the asset down 12.4% over the past week. 

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By midday, the price had partially recovered to $4,032, reflecting a 2.93% daily decline. 

The correction wasn’t totally unexpected, as previously analysts had anticipated a downward move below the $4,000 level. Still, ETH’s downward trajectory triggered significant liquidations across the market. 

Coinglass data showed that over the past four hours, over $134 million in ETH long positions were liquidated, contributing to a total liquidation of $140 million.

Lookonchain, a blockchain analytics firm, reported that as ETH dipped below $4,000, a trader’s (0xa523) entire 9,152 ETH long position valued at $36.4 million was liquidated.

“His total losses now exceed $45.3 million, leaving him with less than $500,000 in his account,” the post read.

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While retail traders suffered losses, whale activity revealed a more complex picture. Investor sentiment in September remained highly volatile, with whales adopting divergent strategies.

On the selling side, Grayscale transferred over $53.8 million in ETH to Coinbase yesterday.

“Big money isn’t buying Ethereum right now,” analyst Ted Pillows wrote.

Other whales followed suit, offloading tens of millions in ETH, including one sale of $12.53 million. BeInCrypto’s latest analysis indicated increased long-term holders’ sales, offsetting bullish inflows.

Conversely, accumulation efforts were also strong. Lookonchain noted that 10 wallets withdrew 210,452 ETH—valued at $862.85 million—from platforms including Kraken, Galaxy Digital OTC, BitGo, and FalconX.  Another whale pulled 22,100 ETH valued at around $91.6 million from Kraken. 

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Nonetheless, an analyst noted that the contrasting pattern shows whales preparing for significant market shifts, either up or down. The analyst highlighted that Binance, the largest exchange for Ethereum flows, reflected this split sentiment. 

Some days saw withdrawals of more than 8 million ETH, while other days showed deposits of up to 4 million ETH, hinting at potential selling. This constant push and pull highlighted the conflicting strategies of market participants.

Yet, much of the Ethereum parked on Binance remained untouched, with the utilization rate hovering near zero. This indicates that while large holders—or whales—were shifting funds, they were largely waiting on the sidelines.

“The market appears to have been preparing for a major move but has yet to trigger it. This type of behavior often precedes: An explosion in volume or a major price shift, either upward or downward. Continued low utilization despite rising deposits could indicate accumulation rather than selling pressure. A subsequent surge in utilization would signal an actual market entry, potentially pushing the price upward or triggering a sharp correction,” the analyst added.

So, what will the next move be? Well, the majority of the analysts agree that ETH faces another downside risk. An analyst drew parallels to ETH’s performance in June, noting that the price could fall to $3,750 before rebounding to $7,000.

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“Ethereum is literally forming the same false breakdown we saw in late June, right before the 100% rally from $2,000 to $4,000. Now, don’t act like you haven’t seen this before,” another analyst stated.

In addition, Benjamin Cowen, CEO of Into The Cryptoverse, suggested that Bitcoin is likely to regain strength in the market, with its dominance potentially rising above 60%. This would mean capital is shifting back into Bitcoin, leaving altcoins relatively weaker. 

“ETH should eventually hit new highs again, but liquidity should flow back to BTC for now,” Cowen remarked.

Moreover, Shawn Young, Chief Analyst of MEXC Research, stressed that if ETH loses the $4,000 support, it could drop to $3,800, but the broader outlook still looks positive

“ETH faces a similar fate, with downside risks to $3,800 if the critical $4,000 support fails, though the medium-term structure remains constructive if buying activity resumes with strong buy-side volume,” Young told BeInCrypto.

Ethereum’s latest dip below $4,000 underlines the tug-of-war between sellers locking in profits and whales quietly accumulating. With liquidations mounting and sentiment divided, ETH’s next decisive move may hinge on whether buyers can defend the $4,000 level—or whether bears force another leg down before the market regains strength.