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▲ Ethereum (ETH), Decline/AI Generated Image
Ethereum (ETH) spot ETFs saw funds exit for 8 consecutive trading days, resulting in a net outflow of $431.86 million. Ethereum's price continued its decline for 4 consecutive weeks, falling to $2,128, and the $2,200 support level that had held throughout April also collapsed.
24/7 Wall Street reported on May 21 (local time) that US Ethereum spot ETFs recorded net outflows every trading day from May 11 to 20. Particularly, over $130.62 million exited on May 12 alone, and the last day of net inflow was May 8.
In April, Ethereum ETFs recorded a net inflow of $355.98 million, raising hopes for a sentiment reversal. This was the first monthly record of net inflow, breaking a five-month consecutive net outflow trend that had continued from November last year to March this year. However, with $260.18 million already flowing out again in May, most of April's recovery gains have been given back.
Ethereum fell by 6% this week, recording a larger drop than Bitcoin (BTC), which declined by 2.3% over the same period. 24/7 Wall Street analyzed that while Bitcoin has a large structural buyer named Strategy, Ethereum lacks a buying entity large enough to absorb the ETF selling volume. Strategy holds 843,738 BTC and is reported to have purchased nearly 25,000 additional BTC in the past week.
Macro shocks were also identified as a factor contributing to Ethereum's decline. After Donald Trump made strong remarks towards Iran, the market interpreted this as a sign of war, and Brent crude oil rose above $112 per barrel. Subsequently, over $657 million in positions were liquidated within 24 hours, Bitcoin fell by 2.4% to $76,500, and Ethereum dropped by 3.5% to $2,116, breaking below the $2,200 support level.
Ethereum financial firm Bitmine also emerged as a variable. Bitmine had purchased over 1 million ETH from January to early May, buying Ethereum at a rate of approximately 100,000 ETH per week, but Chairman Tom Lee announced at Consensus Miami that the weekly purchase volume had been reduced to 26,659 ETH. The company currently holds 5.28 million ETH, securing approximately 4.37% of the circulating supply, reaching about 87% of its 5% target.
24/7 Wall Street pointed out that if Ethereum fails to hold the $2,100 level, the next support level would be $1,900, and below that, $1,650. The 50-day exponential moving average of $2,211 has turned from a support level into a resistance level, and the 200-day moving average is at $2,335. Analysis also suggested that if Ethereum forms a daily close above $2,211, the bearish interpretation could be shaken.
Conditions for an Ethereum reversal include a switch to net ETF inflows, Brent crude falling below $108, and confirmation of the Glamsterdam upgrade schedule. 24/7 Wall Street stated that Ethereum's price carries two-way risks around the $2,100 mark, and from a short-term trading perspective, a break below this support level could lead to a drop to $1,900.
*Disclaimer: This article is for investment reference only, and we are not responsible for any investment losses based on it. The content should be interpreted for informational purposes only.*
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