Ethereum is reeling after a historic institutional withdrawal wave, pulling over $428 million in a single day. ETH-backed ETFs see their worst outflows since last August, with technical indicators painting a concerning picture for the major altcoin. Will the $4,000 psychological threshold hold strong amidst this bearish storm?
Analysis of the ETH/USD daily chart reveals a concerning configuration for Ethereum holders. The altcoin currently trades at $3,986, well below its Super Trend indicator which now forms a dynamic resistance at $4,561. This indicator, which helps traders identify the dominant market direction based on volatility, has switched to bearish mode.
ETH’s position below this technical resistance suggests that the underlying trend remains downward. Without a significant demand revival, Ethereum risks extending its decline toward the first major support at $3,626. If this level gives way under selling pressure, a bearish extension toward $3,215 becomes possible, marking a decline of nearly 20% from current levels.
The momentum remains fragile, and trading volumes currently show no significant accumulation that could reverse the trend. Traders are closely monitoring price behavior around the symbolic $4,000 threshold, a major psychological level that could serve as the dividing line between continued decline and stabilization attempts.
Despite this unfavorable technical context, Ethereum could invalidate this bearish scenario if demand suddenly awakens. Renewed interest in the leading altcoin could propel its price toward $4,211, breaking through the immediate resistance and paving the way for a test of the $4,561 level.
Several catalysts could trigger this reversal: an improvement in overall crypto market sentiment, the announcement of major developments in the Ethereum ecosystem, or institutional flows returning to spot ETFs. The fundamentals of the blockchain remain solid, with sustained DeFi activity and ongoing developments around scalability.
Current volatility also offers accumulation opportunities for long-term investors betting on the strength of the Ethereum project. However, in the immediate term, caution remains advisable as long as technical indicators and institutional flows show no clear signs of reversal.
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