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Ethereum price remained within a narrow range this week as inflows into its exchange-traded funds (ETFs) experienced a noticeable slowdown. The cryptocurrency dropped to a low of $2,400, reflecting the ongoing challenges in the broader crypto market. This level marked a 16% decline from its highest point earlier in the month, placing Ethereum in what analysts consider a technical correction.

Ethereum ETF Inflows See Significant Decline

According to SoSoValue data, spot Ethereum ETFs recorded $40 million in inflows this week, a sharp drop from the $528 million seen the previous week. This marks the smallest weekly increase since mid-May. Two primary factors contributed to this slowdown:

  • Market Volatility: Investors have adopted a cautious stance as major cryptocurrencies like Bitcoin and Ethereum experienced price declines. This uncertainty has led to reduced enthusiasm for ETF investments.
  • Shortened Trading Week: The U.S. markets were closed on Thursday in observance of Juneteenth, a federal holiday, which limited trading activity.

Despite this week’s decline, Ethereum ETFs have shown resilience, marking inflows for six consecutive weeks. This streak is the longest since ETFs were approved in September of last year. Cumulative ETF inflows now stand at $3.89 billion, with total assets under management reaching $9.6 billion.

Leading Ethereum ETFs at a Glance

  • BlackRock’s ETHA ETF: Total inflows of $5.28 billion.
  • Fidelity’s FETH ETF: Inflows amounting to $1.1 billion.

Ethereum Ecosystem Metrics Signal Weakness

The decline in Ethereum’s price is also tied to a deterioration in its ecosystem metrics. For instance, the stablecoin transaction volume within the Ethereum network has dropped by 31% over the past 30 days, falling to $1.2 trillion. This decline reflects reduced activity and demand within the ecosystem, which has exerted additional pressure on Ethereum’s valuation.

Ethereum Price Technical Analysis

Examining the daily chart, Ethereum’s price has been consolidating since May 10, trading within the support and resistance levels of $2,410 and $2,736. This sideways movement aligns with the formation of a bullish flag pattern.

The bullish flag is a continuation pattern characterized by a vertical price surge followed by a brief consolidation, often signaling a potential breakout.

This pattern typically forms between the 50% and 38.2% Fibonacci Retracement levels and is supported by the coin trading above the 50-day and 100-day Exponential Moving Averages (EMAs). As long as Ethereum remains above the lower boundary of the flag at $2,400, the likelihood of a bullish breakout increases.

Key Levels to Watch

  • A move above the upper boundary of the flag at $2,735 could confirm further gains.
  • If this breakout occurs, the next psychological resistance level to monitor is $3,000.

While Ethereum’s price remains in a consolidation phase, the potential for upward momentum depends on a combination of technical indicators and market sentiment. Investors should closely monitor key price levels and ecosystem developments to make informed decisions in this evolving market.

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