Ethereum took a sharp hit, plunging 6% in 24 hours to trade at $3,630, according to CoinMarketCap. The sudden drop followed a strong July rally, where ETH soared over 50%, marking its best monthly gain in three years.
However, selling pressure surged just as Ethereum neared the $4,000 resistance, confounding traders who expected strong ETF inflows and corporate reserves to push the price higher.
During the span of 19 days, there were inflows into spot ETH ETFs, total holdings for which grew to $21.85 billion. Strategic ETH reserves also rose beyond $10 billion. Despite this bullish setting, market sentiment changed bearish, as price action confronted a well-identified supply zone near $4,000, an area historically associated with hefty sell pressure.
At the time of publishing, ETH is trading near $3,642, down 5.7% in the past 24 hours, as per CoinMarketCap data.
Technicals Show Strength, but $4K Holds Firm
According to crypto analyst Crypto Fella, ETH recently broke several tough resistance levels between $2,600 and $3,500. The rally stemmed from a strong bounce off a long-term trendline dating back to mid-2022. However, the $4,000 zone remains a psychological and technical barrier.
Moreover, as shown by the data, the supply-heavy zone just above $3,800 forms the reason for selling pressure at present. Failure to take out $4,000 could pull Ethereum again to the $3,300–$3,500 zone. Still, the uptrend remains intact if ETH can hold above $2,900.
Could History Repeat Itself?
Analyst Merlijn The Trader believes Ethereum is mimicking its 2021 bull cycle. He points to a similar pattern of a “dead cat bounce,” a final support retest, then an explosive breakout.
Ethereum completed a comparable retest near $2,000 recently and may now be entering the ignition phase. If the pattern holds, Ethereum could climb toward $8,000–$11,000 in the coming months.
Ethereum sits on a pivotal edge. A breakout above $4,000 could trigger another massive bull run. But failure might spark a correction. With ETFs growing, institutional demand rising, and historical patterns aligning, the market may be on the verge of something big, or bracing for a shakeout.
Also Read: SharpLink Adds 11,259 ETH on Ethereum’s 10th Anniversary
