Could EIGEN Price Reach $5 After Whales Go Big on EigenLayer?

After a recent breakout attempt, EigenLayer (EIGEN) has seen a price drop of about 10% in the last 24 hours, making it difficult for the token to reach $5.

However, Cryptocurrency has entered a significant buying activity to prevent further declines. As the situation unfolds, investors will be watching closely to see if this intervention can lead to a recovery for EIGEN.

Whales buy the EigenLayer Dip

EigenLayer, a leading Ethereum-based blockchain project, launched its native platform a week ago. Despite the initial price crash, EIGEN rose from $3.13 to $4.15 between October 6 and 10, fueling speculation of further gains.

However, the token dropped to $3.62 in the last 24 hours, with a 40% decrease in trading volume.

From a business perspective, an increase alongside inflation indicates strength and potential growth. But since both price and volume have decreased, this indicates that the downward trend may be weakening, indicating that a recovery is possible for EIGEN soon.

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Crypto analyst Michael van de Pop believes that EIGEN's recent decline may be short-lived. This dip suggests that this dip could set the stage for a rally as EIGEN is likely to rise to $5 in the near term.

“One of the most promising projects, EIGEN, is doing well. It took the liquid and started to improve, so the whole ecosystem woke up. Expecting to take the liquid at $4.25, dip a bit (entry point) and then rally to $5+, the analyst wrote on X.

In line with this sentiment, on-chain data shows that crypto-wells continue to buy the token. Looking at the net flow of large holders, which shows the difference between the amount of cryptocurrency bought and sold by large investors, it has jumped by a whopping 168% in the past seven days.

This increase shows that a large amount of accumulation is taking place compared to circulation. Lookonchain also confirms that two different wallets bought EIGEN worth more than $6 million yesterday.

EIGEN Price Forecast: Support remains strong

EIGEN's current price of $3.62 is close to the 38.2% Fibonacci retracement level, which is a key technical indicator for identifying support and resistance. The 38.2% level at $3.58 serves as a major support floor, suggesting a price reversal.

If EIGEN breaks out of this level, it could move higher to the 78.6% Fibonacci retracement at $4.14.

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But if Crypto Wells doesn't increase its holdings, its price could drop. In addition, the upcoming token opening in October could limit the upside momentum, which could push EIGEN down to $3.37, the low of the 78.6% Fib level.