Ethereum fell below $2,000 for the first time in several months, but there is no sign of panic among retail investors yet.
Judging by market sentiment, many still expect a rebound. However, large holders of Ethereum have increasingly preferred to reduce their positions rather than increase them in recent weeks.
According to analysts, Ethereum has entered a decisive phase of breaking through its main technical structure. If selling pressure persists, the next target for the decline could be around $1,750.
Thus, the market faces an interesting divergence: while whales are taking profits or reducing risk, retail investors continue to bet on a price recovery.
Retail Investors Keep Buying the ETH Dip
After Ethereum fell below the important psychological mark of $2,000, there was a sharp increase in calls on social media to buy the coin on the dip.
According to analytics platform Santiment, by Thursday the number of “buy the dip”-style messages had noticeably increased. This indicates that many retail investors still expect a quick rebound and see the current drop as a buying opportunity.
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However, such optimism is not always considered a positive signal. Historically, surges in interest in buying dips have often occurred when the market had not yet reached a local bottom. Therefore, the ongoing enthusiasm among retail participants may indicate a risk of further price decline for ETH.
Optimism around ETH surged after it fell below $2,000. Source: Santiment
This suggests that many retail investors still see the current decline as a chance to buy ETH at a lower price, rather than as a signal of a possible continued drop.
However, history shows that such optimism after sharp declines does not always work in buyers’ favor. Often, the market finds a bottom only after enthusiasm turns to fear and participants begin to capitulate en masse.
According to Santiment, a stronger buy signal may appear later.
“There will still be an opportunity to buy Ethereum, but ideally you should wait until most participants stop giving in to FOMO and start to panic,” Santiment analysts noted.
According to them, the best entry points usually appear when market sentiment becomes extremely negative.
Institutions Sell Despite Retail Optimism
While retail investors keep buying the dip, large market participants are acting differently.
Recently, Harvard University’s investment fund fully closed its position in Ethereum for about $87 million. Bankless co-founder David Hoffman, who had long been one of the most prominent Ethereum supporters, also announced the sale of his ETH holdings.
There is also pressure from exchange-traded funds. Since May 7, US spot ETFs for Ethereum have seen almost continuous capital outflows.
Over the past two weeks, investors have withdrawn more than $470 million from such funds, indicating continued caution among institutional players.
Investors continue to withdraw funds from spot Ethereum ETFs. Source: Glassnode
Largest Ethereum Holders Also Not Rushing to Buy the Dip
According to Glassnode, wallets with balances over 10,000 ETH—often classified as mega whales—continue to reduce their holdings. Since the start of 2026, the amount of coins at such addresses has dropped by more than 5%.
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While retail investors are actively buying the dip, the largest market participants are gradually reducing their share in Ethereum. This may indicate that big capital does not yet see convincing signals for a trend reversal.
Ethereum mega whales continue to reduce ETH holdings. Source: Glassnode
Amid sell-offs by large holders, the main exception remains BitMine, associated with Tom Lee.
The company currently holds about 5.21 million ETH, which is about 4.3% of the total Ethereum supply. Previously, Lee said that BitMine aims to eventually bring this share up to 5% of the network.
In his view, Ethereum could benefit from the long-term trend toward tokenization of traditional assets and the spread of AI agents, which will need neutral public blockchains to operate.
However, so far this bet looks unsuccessful. According to DropStab, the average purchase price of ETH by BitMine is about $3,484 per coin.
At the current rate of about $1,990, the company’s position remains deeply underwater on paper. According to analysts, BitMine’s unrealized loss is already about $8 billion.
BitMine’s loss on its Ethereum position exceeds $8 billion. Source: DropStab
Ethereum May Retest the Low Around $1,750
On Thursday, ETH lost another 3% intraday and fell to $1,965.
From its 2026 high of about $3,400, the price of Ethereum has already dropped by more than 40%.
The latest wave of selling began after the price broke down from a pattern resembling a rising wedge. In technical analysis, this pattern is usually seen as a signal of a possible continued decline.
As long as ETH remains below key resistance levels, some analysts expect a retest of the $1,750 area, which previously served as an important support zone for the market.
Three-day ETH/USD chart. Source: TradingView
Such patterns are usually played out after a break below the lower boundary of the wedge. The downside target in this case is calculated by the height of the pattern and projected downward from the breakout point.
Ethereum broke down from this structure last Saturday and has continued to lose ground since. Against this backdrop, analysts are again focusing on the $1,750 area, which now appears to be the next major target for the bears.
If this scenario plays out, ETH will lose another 18.5% from current levels.
