Ethereum (ETH) is teetering on the edge of a potential bullish turnaround amid a sharp January selloff, but the $3,160 level stands as the critical hurdle for buyers to prove their strength. The second-largest cryptocurrency plunged nearly 6% in the last 24 hours and 13% over two days, pushing prices down to around $2,960 as of January 21, 2026. Despite the pain, on-chain data reveals aggressive whale accumulation—large holders snapped up roughly $360 million worth of ETH near the lows—signaling confidence that the downside may be capped.
Whale Buying Signals Bottoming Interest
Whales have been busy defending key levels. According to Santiment and Glassnode data, major holders increased their ETH stash from about 103.42 million to 103.71 million during the recent dip. This mirrors buying patterns seen earlier in January that preceded quick rebounds, suggesting smart money views current prices as a bargain. On X, traders like @TedPillows have highlighted the need for ETH to reclaim $3,200 for a sustained upside, while others note the $3,160–$3,170 zone as a strong demand area aligning with trendlines and fair value gaps.
Technical Setup Hints at Bullish Divergence
The daily chart shows ETH trading within a symmetrical triangle pattern, with the price now testing the lower boundary near $2,910. A bullish divergence on the RSI—where price made lower lows but the indicator formed higher lows—indicates weakening selling pressure and a possible reversal brewing. However, the Smart Money Index remains cautious, staying below its signal line, which has historically preceded big moves only after confirmation. Clearing the dense supply cluster between $3,146 and $3,164, where millions of ETH were accumulated, would require a daily close above $3,160 to unlock momentum toward $3,390.
Risks Linger if Support Breaks
The downside remains real if buyers fail to hold. A break below the $2,910 triangle support could expose $2,610 as the next major floor, intensifying the pullback. Community sentiment on X reflects this split—some see a double bottom forming around $3,160 for a bounce to $3,300+, while others warn of further tests near $3,000–$3,050 if resistance holds firm. Broader market hesitation, combined with this heavy overhead supply, means ETH needs decisive volume to flip the script.