Ethereum Price Warning: $1,500 Risk Appears As A Bullish Metric Drops 90%

What Happened

Hodler Net Position Change tracks whether long-term investors are accumulating or selling. On January 18, the 30-day net position change peaked near +338,708 ETH. This showed strong accumulation.

NUPL measures how much profit or loss holders have on paper. It compares current prices with the average purchase price. When NUPL is high, most investors are in profit. When it turns negative, many are at a loss.

“There are two separate capital flows. There is institutional capital that was beginning to heavily invest in crypto across all asset classes, and then there are retail flows. Institutional capital is always macro first, and when markets shift, crypto is still viewed as a risk asset. Meanwhile, short-term speculative capital surged in Q4,” he highlighted

Market Context

The Ethereum price is showing early signs of stabilization after a sharp sell-off in late January. ETH has rebounded about 4.6% over the past 24 hours after dipping near $2,160. On the surface, this looks like a relief bounce inside a broader falling wedge pattern.

A 37% Price Drop Couldn’t Break Pattern, But There’s A Catch

Between January 6 and January 14, ETH made a higher high, while the Relative Strength Index (RSI) made a lower high. RSI measures momentum on a 0–100 scale. When price rises, but RSI weakens, it signals fading buying pressure. This divergence often leads to trend reversals, and Ethereum responded accordingly.

Despite the sharp drop, the price has stayed inside a falling wedge. A falling wedge forms when the price makes lower highs and lower lows inside narrowing trendlines. It is usually a bullish structure that signals weakening selling pressure.

This means long-term holders have sharply reduced buying during the correction. When conviction holders do not accumulate into weakness, it usually signals that the market has not reached a true bottom. Strong bottoms form when long-term holders keep accumulating even as prices fall. That is not happening now.

However, on a one-year view, NUPL is still far from true capitulation.

In April 2025, NUPL fell to −0.22. That marked deep fear and capitulation. After that, ETH rallied from about $1,472 to $4,829, a surge of roughly 228%. Today, NUPL is nowhere near those levels.

This suggests that large-scale capitulation has not happened yet. There may still be room for further downside before a durable bottom forms.

This pattern highlights a growing divide between speculative traders and longer-term capital.

Why It Matters

But on-chain data tells a more cautious story. While the bullish structure has not fully broken, long-term holder behavior and profit-loss metrics are weakening. Together, they suggest that this rebound may lack strong conviction. If these trends persist, Ethereum could remain vulnerable to another leg lower, with even $1,500 in sight.

Exchange transfer data adds to this risk. During the late-January drop, numbers of transfers (not coins) fell to around 23,000–24,000 per day. This showed reduced selling pressure near the lows. But during the rebound between February 1 and February 2, transfers jumped to above 37,000.

That is a rise of more than 50% in one day. This means many holders (possibly the speculative ones) used the bounce to move ETH to exchanges and likely sell. When every rebound triggers a spike in transfers, it signals that rallies are being distributed, not accumulated.

Details

Since mid-January, Ethereum has fallen nearly 37% to lows around $2,160. The decline followed a clear bearish divergence.

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So structurally, Ethereum has not fully broken down. However, something more important has weakened: long-term holder conviction.

By February 2, that figure had collapsed to around +40,953 ETH. That is a drop of nearly 90%.

Paper Profits And Exchange Transfers Show Rallies Are Being Sold

The second warning comes from Ethereum’s Net Unrealized Profit/Loss (NUPL) and exchange transfer data.

In late January, Ethereum’s NUPL dropped from around 0.25 to near 0.007 by February 1. This shows that profits have almost vanished, but not completely.

Gil Rosen, Co-Founder of the Blockchain Builders Fund, described this split in an exclusive quote to BeInCrypto:

This behavior keeps upward moves weak.