Ethereum (ETH) has fallen below the critical $3,500 support level, raising concerns about the sustainability of its recent rally. However, on-chain metrics and institutional activity suggest the dip may be temporary.
ETH Falls After Failing to Break $4K
After an explosive 60% surge in July, Ethereum failed to push through the $4,000 resistance zone, triggering a 12.5% pullback to the mid-$3,400 range. This technical rejection coincides with profit-taking across the broader crypto market.
Spot Ethereum ETFs also saw their first outflows in over 20 days, signaling a minor sentiment shift among U.S. investors.
SharpLink Boosts ETH Holdings Despite Price Dip
Interestingly, institutional interest remains strong. SharpLink Gaming recently acquired 26,192 ETH (worth ~$96 million), bringing its total holdings to 464,000 ETH, now valued at $1.63 billion. The firm, guided by Ethereum co-founder Joseph Lubin, aims to become the largest ETH treasury holder.
This aggressive buy-up during a dip reflects long-term confidence in Ethereum’s role as the “base layer for a trillion-dollar digital economy.”
Technical Outlook: Support Holding, But Caution Remains
ETH currently trades between $3,400 and $3,500, where traders are watching for either a breakdown to $3,200 or a rebound toward $3,800. The Relative Strength Index (RSI) hovers near neutral at 45, indicating room for either further downside or a fresh leg up.
If the $3,400 level holds, analysts expect consolidation before another attempt to breach $4,000.
Conclusion: Healthy Reset or Trend Reversal?
While Ethereum’s drop below $3,500 may rattle short-term traders, the combination of strong treasury buys, modest ETF outflows, and neutral on-chain signals suggests this is likely a healthy reset, not the end of the bull cycle.
Disclaimer
This content is for informational purposes only and does not constitute financial, investment, or legal advice. Cryptocurrency trading involves risk and may result in financial loss.