Ethereum ‘s New Correction Raises Questions
Despite reaching a new all-time high at the end of August, Ethereum is once again experiencing a difficult period, trading around $4,360. This recent 7% drop in one week raises numerous questions about the factors behind this new decline.
Ethereum : Whale Profit-Taking and Investor Risk Aversion
On-chain data reveals that major investors, known as “whales“, have transferred thousands of Ether to exchange platforms, a classic sign of profit-taking. Additionally, American Ethereum ETFs recorded net outflows of $135 million on September 2, suggesting a withdrawal movement among investors.
Seasonality: “Red September” Weighs on Cryptocurrencies
September has historically been a difficult month for cryptos, with an average decline of 4% for Bitcoin and a similar trend for Ethereum. This seasonal phenomenon, nicknamed “red September,” is explained by portfolio rebalancing and decreased liquidity in the markets.
Macroeconomic Uncertainty and Federal Reserve Policy
Ethereum is also falling amid persistent macroeconomic uncertainty. Investors remain cautious about the evolution of the US Federal Reserve’s monetary policy, which is struggling to control inflation. This risk aversion translates into profit-taking on the most volatile assets like Ethereum.
In summary, the recent drop in Ethereum can be explained by a combination of factors: profit-taking by large investors, unfavorable seasonality, and macroeconomic uncertainties. Until the Fed adopts a more accommodative policy, digital assets risk remaining under pressure. Investors should exercise caution in the coming weeks.
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