Ethereum Defies Gravity at $4K Support Despite Record $795M ETF Exodus

Ethereum's foundation holds firm while traditional finance flinches.

The $4K Battle Line

Ethereum digs in at the critical $4,000 support level—proving decentralized networks show more resilience than Wall Street's paper hands. While ETFs hemorrhage $795 million in a single week, the underlying protocol continues processing transactions without missing a beat.

Smart Money vs. Dumb Money

Institutional products bleed assets exactly when the network demonstrates its fundamental value. The irony isn't lost on crypto natives watching traditional finance panic-sell exposure to the very technology disrupting their business models. Meanwhile, active addresses and DeFi TVL tell the real story of organic adoption.

Finance's predictable short-termism strikes again—chasing hype on the way up, capitulating at the first sign of volatility. The $795 million outflow says more about ETF investors than it does about Ethereum's actual health. The network keeps building while paper profits evaporate.

Ethereum price falls as ETH ETF outflows rise

Ethereum (ETH) was trading at the important support level at $4,000, down from the year-to-date high of $4,920. It remains up by 190% above the April low of $1,377.

ETH price pulled back this week as demand from American institutional investors slowed and liquidations rose. 

Data shows that ETH ETFs suffered a record $795 million outflow this week. The previous weekly record was in the first week of September, when they shed over $787 million in assets.

Ethereum funds experienced inflows of $556 million last week and $637 million the week before. That is a sign that the growth momentum among American institutions is falling. 

These funds now have $26 billion in assets, which is equivalent to 5.37% of the total supply. 

ETH price also slipped after suffering a whopping $1.5 billion in liquidations during the week. These liquidations happened as exchanges like Binance and OKX closed Leveraged bullish trades as the price crashed. Historically, an asset drops when there are a big increase in liquidations.

Macro factors also contributed to the ethereum price crash. For example, there are concerns on whether the Federal Reserve will continue cutting interest rates in the coming weeks amid persistent inflation. A report released this week showed that the personal consumption expendituremoved further away from the Fed target of 2.0%.

ETH price technical analysis

The weekly chart shows that the ETH price pulled back from the year-to-date high of $4,918 to a low of $3,825 this week.

On the positive side, the coin has formed a break-and-retest pattern since the current level is along the highest point in March, May, and November last year. A break-and-retest is a common continuation sign. 

The coin has also remained above the 50-week and 100-week Exponential Moving Averages. Therefore, the outlook is bullish as long as it remains above the support at $4,000. If this happens, the coin will likely retest the all-time high and MOVE towards $5,000.