Ethereum (ETH) delivered a dramatic performance as it plunged by more than $500 following its record-breaking rally to a new all-time high above $4,900. After reaching this milestone, ETH retraced notably to around $4,600, triggering concern and excitement across the crypto community.

The swift drop reflects the intense volatility often seen after major upward moves, where profit-taking and market indecision come to the forefront. Technical analysis shows bulls are struggling to secure strong support, with key zones now watched closely by traders to gauge the next direction. Current price action pivots near the 50 and 100-day simple moving averages, sitting around $4,455 and $4,435 respectively. If these levels do not hold, eyes turn to the 200-day average near $4,068 as the next major support.

Despite the selloff, large investors—often referred to as „whales“—on major exchanges like Binance appeared to increase their ETH holdings, signaling renewed confidence in Ethereum’s long-term prospects even during market stress. This accumulation underscores that institutional and high-net-worth buyers see Ethereum’s underlying fundamentals and its central role in DeFi and smart contracts as key strengths.

The pullback also occurs against a backdrop of increased institutional interest in Ethereum, with historic inflows into ETH-focused investment funds and ETFs. Regulatory developments and renewed attention from traditional finance further fuel optimism that, despite short-term carnage, Ethereum’s value proposition remains intact. Some analysts continue to project ambitious longer-term targets well beyond current levels, citing its expanding use in stablecoins and tokenization.

For now, Ethereum’s sharp retreat serves as a reminder of the risks and rewards inherent in crypto trading. Market participants are closely monitoring whether ETH can stabilize in the coming days or if further downside looms before another potential leg up.