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Ethereum (ETH) has been trading around $4,000 for the past two weeks, a period of consolidation following the Oct. 11 flash crash to below $3,500. Ethereum traders are assessing the possibility of further bullish momentum after the Federal Reserve confirmed a 0.25% rate cut and the end of quantitative tightening.  ETH/USD 4-hour chart. Source: Cointelegraph/TradingView Ethereum price lacks sustained bullish sentimentEthereum futures currently trade at a 5% premium to the standard ETH spot market, reflecting lower demand from leveraged buyers. Under neutral market conditions, contango is typically between 5% and 10% to compensate for the longer settlement period. More worryingly, even the recent recovery to $4,250 has failed to restore sustained bullish sentiment among traders.  Ethereum annualized futures, three-month rolling basis. Source: Glassnode The bearish trend in Ethereum futures coincides with U.S. Ethereum spot exchange-traded fund (ETF) outflows that have dominated since mid-October. Net ETF inflows of $38 million on Monday and Tuesday failed to generate any bullish momentum, leaving traders questioning whether the $10,000 ETH price target remains realistic for this cycle.  US Spot Ethereum ETF daily net flows, USD. Source: SoSoValue Ethereum’s failure to remain above $4,000 can also be attributed to declining Ethereum network fees, although this issue affects the entire cryptocurrency market.  Blockchains ranked by seven-day fees, USD. Source: Nansen Ethereum chain fees totaled $5 million over the past seven days, down 16% from the previous week. In comparison, BNB chain fees dropped by 30% and Tron dropped by 16%. The number of active addresses in the Ethereum base layer dropped by 4% during the same period, while Tron increased by more than 100%. “Classic Bear Trap” or ETH price heading lower?Data from Cointelegraph Markets Pro and TradingView indicate that Ethereum price has recorded its third consecutive red candle on the daily chart. Ethereum's multiple attempts to rally have been rebuffed by resistance at $4,000, prompting traders to wonder whether ETH's rally is over or is simply entering a technical pullback phase. “$ETH has once again lost support at $4,000,” analyst Ted Pillows said in an X post on Thursday. Pillows noted that Ethereum fell despite “a 0.25% Fed rate cut, quantitative tightening ending in a month, and US-China trade talks” all taking place in the past 24 hours. The accompanying chart shows that the next level of defense for ETH is $3,800, losing which would spark another round of selling, first into the $3,500-3,700 demand zone and then towards the $3,354 low reached on August 3. On the upside, recapturing $4,000 will boost bulls’ confidence to focus on the $4,200 and $4,500 hurdles before moving back to all-time highs above $5,000. Ted Pillows added: “Either this is a classic bear trap or the crypto market is going to drop significantly. ”  ETH/USD daily chart. Source: Ted Pillows Analyst Fibonacci Trading said that “a drop to $3,300 would still be viewed as a healthy pullback in the uptrend, supported by the EMA cloud,” as shown on the weekly chart below. “It would be a real show of strength if the bulls can defend support here and prepare for the next attack on resistance. ”  ETH/USD weekly chart. Source: FibonacciTrading Anonymous analyst Cactus believes that as long as bulls hold on to the support range of $3,800 to $4,200, Ethereum's upward trend will remain solid and "a strong fourth quarter is still expected." According to reports, bulls will have to push the price above the 50-day simple moving average (SMA) at $4,200 to show strength and confirm the start of the next leg to the upside. Golden Elephant was born for the continuous improvement of Web3 ecology! Golden Elephant, focusing on Web3 ecological system construction and operation! Pay attention to the golden elephant! Contact us! Receive information and join the group…… Please scan the code to add Xiang Xiaosuke  |
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