Institutional Demand Weakens
Ethereum managed a small 1% gain over the past day, pushing back toward the $4,000 mark. But honestly, this recovery feels pretty shaky when you look at what’s happening behind the scenes. The institutional money that usually supports these moves seems to be heading for the exits.
According to the data from SosoValue, spot ETH exchange-traded funds saw net outflows totaling $796 million just this week. That brings the month-to-date liquidity exit from these funds to $388 million. If this trend continues through September, it would mark the first month of net outflows for ETH ETFs since way back in March. I think that’s telling us something about how the big players are feeling right now.
Long-Term Holders Are Selling
What’s perhaps more concerning is the behavior of Ethereum’s long-term holders. The Liveliness metric, which tracks the movement of long-held tokens, has climbed to a year-to-date high of 0.70. When this number goes up, it means coins that have been sitting in wallets for a while are being moved or sold.
It’s essentially profit-taking by people who’ve held through previous cycles. They’re looking at these prices and deciding it’s time to cash in some chips. This creates additional selling pressure that makes it harder for ETH to build any real momentum.
The Support Level That Matters
Right now, Ethereum is holding above the $3,875 support level. That’s the floor that’s been keeping things from getting worse. But with ETF money flowing out and long-term holders selling into any strength, I’m not sure how long that support can hold.
The technical picture suggests that if $3,875 breaks, we could see ETH fall toward $3,626. On the flip side, if today’s rally somehow gains traction and attracts real buying interest, there’s a path toward $4,211. But that would require a shift in sentiment that just doesn’t seem to be happening yet.
It’s one of those situations where the price action looks okay on the surface, but the underlying data tells a different story. The institutional retreat combined with long-term holder selling creates headwinds that make sustained gains difficult. Maybe the market needs some positive catalyst to change the narrative, but for now, the path of least resistance appears to be lower.
