Ethereum appears to be stabilizing after a sharp corrective move, with ETH trading near $2,950 following a roughly 15.6% pullback from its January high. While short-term price action still looks weak on the surface — ETH remains down about 11% on the week — several underlying signals suggest market conditions may be shifting.
A completed bearish momentum reset, aggressive whale accumulation, and a sudden rebound in network usage are now aligning. Together, these factors raise a key question for market participants: is Ethereum setting up for a stronger recovery, or is this merely a temporary bounce?
Bearish Momentum Exhausts as Volume Diverges
Ethereum’s recent weakness was not random. Between January 6 and January 14, ETH printed a clear bearish RSI divergence on the daily chart. While price pushed to higher highs, the Relative Strength Index — a momentum indicator — formed a lower high, often signaling trend exhaustion.
That signal played out cleanly. ETH corrected approximately 15.6%, sliding into the $2,860 support zone before finding stability.
What happened at support is critical.
As price trended lower between January 20 and January 21, On-Balance Volume (OBV) formed a higher low. This divergence suggests selling pressure was weakening, with larger players absorbing supply rather than distributing. OBV measures volume flow, and this type of divergence often appears near local market bottoms.
Ethereum Whales Step In With Size
Whales appear to have responded decisively to that shift in momentum.
Over the past 24 hours, Ethereum supply held by non-exchange whale wallets increased from 103.73 million ETH to 104.08 million ETH — an addition of roughly 350,000 ETH in a single day.
At current prices, this accumulation is worth just over $1 billion.
This behavior suggests whales were not chasing price highs. Instead, they entered after ETH reclaimed key support and bearish momentum cooled, treating the pullback as an accumulation opportunity rather than a reason to exit.
Network Activity Rebounds as Ethereum Regains Ground
Technical stabilization is being reinforced by improving on-chain fundamentals.
As of January 23, Ethereum reclaimed the #2 position among Layer-1 blockchains by Daily Unique Addresses (DUAs), ranking just behind BNB, according to on-chain analytics. ETH overtook SEI, a competing Layer-1 that recently saw elevated activity due to gaming-related developments. opBNB, a BNB Layer-2, remains higher.
Daily unique addresses are a critical metric because they reflect actual network usage, not price speculation. Ethereum reclaiming this position indicates that on-chain activity is recovering even as price remains below recent highs.
Notably, Ethereum continues to outperform all major Layer-2 ecosystems in absolute address growth, reinforcing its position as the dominant smart contract settlement layer.
Social Attention Rises Alongside Accumulation
This rebound in fundamentals has begun to spill into market sentiment.
Ethereum’s social dominance surged from approximately 0.37% to 4.43% in a single day, briefly peaking near 5.8% before cooling. Historically, local spikes in social dominance have often preceded short-term ETH price advances.
For context:
On January 17, a social dominance spike was followed by a 2.1% ETH rally
On January 21, a similar surge preceded a 3.4% move within 24 hours
While these signals do not guarantee a sustained recovery, they suggest renewed relevance and attention — particularly when paired with $1B+ whale accumulation and rising network usage.
Key Price Levels Now Define the Setup
From here, Ethereum’s structure is relatively clear.
On the downside, $2,860 remains the critical support level. This zone marked the end of the 15.6% correction and the point at which whales accumulated aggressively. A decisive break below this area would weaken the bullish thesis and reopen downside risk toward lower supports.
On the upside, ETH must reclaim $3,010 — just about 2.6% above current price — to confirm short-term strength. Sustained acceptance above this level would bring $3,350 into focus, a resistance zone that has capped price action since mid-January.
A clean breakout beyond that region could open the door toward $3,490 and $3,870, though failure to hold $2,860 would instead shift attention back toward $2,770, invalidating the recovery narrative.
Final Thoughts
Ethereum’s price remains under pressure in the short term, but whale behavior, improving on-chain usage, and momentum stabilization suggest the recent correction may be more than just noise.
Whether ETH can convert this accumulation phase into a broader recovery will depend on how price reacts around key technical levels — and whether network activity continues to strengthen alongside sentiment.
This article is for informational purposes only and reflects personal analysis. It does not constitute investment advice. Readers should conduct their own independent research before making any financial decisions. The author assumes no responsibility for investment outcomes.
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