In the volatile world of cryptocurrency, Ethena has been hit hard in recent days. The Ethena token (ENA) has seen its price retreat for three consecutive days, dropping to $0.95, dipping below the psychologically significant $1 mark for the first time since December 20.
This decline is part of a broader risk – off sentiment in the crypto industry that has also pushed Bitcoin and other prices lower. Bitcoin has dropped 2.16% and is currently trading below $96,000, with Bitcoin ETFs experiencing $680 million in outflows. Ethereum ETFs have also been impacted.
On – chain data reveals that whale activity is a major factor in Ethena’s price plunge. A significant transaction saw a whale send 11.6 million ENA tokens, worth $11 million, to Binance, the largest crypto exchange. Another trader transferred ENA tokens valued at $10.7 million to Binance. On December 26, Thursday, Ethena whales dumped tokens worth $30 million. This follows a sale by Arthur Hayes, Bitmex founder and early investor, a week prior. According to Nansen, Hayes now holds 18,616 coins worth $17,458.
The rise in ENA tokens on exchanges has also contributed to the bearish outlook. Tokens on exchanges have increased by 5.82% in the last seven days, reaching over 730.27 million. The total supply on exchanges has moved up to 4.87%, a 0.27% increase from a week ago.
Additionally, inflows into Ethena’s USDe stablecoin have come to a halt. With a market cap of $6 billion, remaining stagnant in the past few days, it indicates sluggish demand for the token.
From a technical perspective, Ethena is showing worrying signs. It has formed a head and shoulders pattern on the four – hour chart. This pattern, consisting of a neckline at $0.8552, two shoulders, and a head, often leads to strong downward momentum when the price moves below the neckline. Ethena has also reached the 38.2% Fibonacci Retracement level, slipped below the 50 – period moving average, and fallen below the strong pivot reverse level of the Murrey Math Lines.
As a result, the token is likely to continue its downward trend. The immediate target is the head – and – shoulders neckline at $0.8552. A drop below this level could signal further downside, potentially reaching the extremely oversold level of $0.5860.
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