Ethereum traded narrowly this week, maintaining a stable price around $1,580 as trading activity remained subdued. The cryptocurrency has risen approximately 14% from the lowest level it touched earlier this month, but continues to encounter significant headwinds amid growing market competition.
In particular, Ethereum is feeling pressure from layer-2 scaling solutions like Base and Arbitrum, along with rising interest in alternative layer-1 blockchain networks such as Solana and Sui. These competing ecosystems are steadily capturing market share in key sectors like decentralized finance (DeFi) and online gaming, driving some attention and investor funds away from Ethereum.
Another troubling sign for Ethereum is the ongoing pace of redemptions from its spot exchange-traded funds (ETFs). These investment products reported zero inflows on Thursday, marking the eighth consecutive weekly decline and accumulating total net outflows of approximately $2.24 billion. This consistent lack of investor interest in Ethereum spot ETFs highlights the weakening appetite among institutional and retail investors.
Recent metrics also illustrate investors’ increased willingness to sell ETH at losses. Data tracking Ethereum’s Network Realized Profit/Loss indicator has persistently been in negative territory, a signal that holders are capitulating rather than maintaining their holdings in anticipation of a market rebound.
However, technical analysis reveals a potentially positive setup for Ethereum moving forward. While the daily chart clearly illustrates a strong bearish trend—Ethereum is trading significantly below its crucial 50-day and 200-day exponential moving averages (EMAs) and beneath the key psychological support of $2,140—a bullish divergence is visible. The moving average convergence divergence (MACD) oscillator is trending upward, suggesting building momentum as sellers begin to lose strength.
Additionally, the relative strength index (RSI) has crept slightly above its prevailing downward-sloping trendline, reinforcing a cautiously positive outlook. Ethereum’s current price action also resembles a large-scale falling wedge formation, characterized by converging downward-sloping trendlines. Such patterns typically precede a robust bullish breakout once these trendlines intersect.
Should a bullish breakout materialize as indicated by this wedge pattern, the next considerable resistance area around the preceding support of $2,140 would become a primary price target, representing a potential upside of roughly 35% from Ethereum’s current valuation.
