Ethereum price (ETH) reverses from a month’s high during the early hours of the “Turnaround Thursday”, snapping a five-day winning streak. In doing so, the altcoin falls around 4.0% intraday to $3,190 by press time.
The ETH’s latest weakness may be tied to the market’s risk-off mood, mixed on-chain indicators, and bearish technical analysis. Still, the largest altcoin has multiple positives that can defend the buyers, even as the bears keep eyes on the $2,750 support confluence.
Let’s dig into the details!
Upbeat Macros, Staked ETH ETF Buzz, Layer-2 Activity, and Whale Buying Lure Ethereum Bulls
Starting with the macro trend, the U.S. Federal Reserve’s (Fed) third straight rate cut joins the hopes of lower rates in 2026 to defend the cryptocurrency buyers, especially the ETH as it is the largest altcoin and is used widely, even more than Bitcoin (BTC).
Still, the biggest ETH news is BlackRock’s filing of the Staked Ethereum ETF. Earlier in the week, BlackRock, the world’s biggest asset manager, filed for a staked Ethereum ETF. The staked ETH ETF optimism also takes clues from a leadership change at the Securities and Exchange Commission (SEC) as the newly appointed Chair, Paul Atkins, advocates for staking benefits.
Elsewhere, Ethereum’s dominance in Decentralized Finance (DeFi), with 68% market share, comes as 81% and 108% increases in transactions on Polygon and Base, ETH’s Layer-2 networks, respectively, keep second-largest cryptocurrency buyers hopeful.
That said, wallets holding more than 10K ETH, generally considered whale wallets, have been recently active as whale monitor, Whale Alert, highlighted a huge wallet activity after more than a decade.
On the same line, data from Santiment also mentioned that whale and shark (100-100 ETH) wallets have accumulated approximately 934,240 ETH, over $3 billion, in the past three weeks.
It’s worth noting that upbeat trading volume on the spot market, despite a pullback in the market capitalization (market cap), also underpins bullish bias about the ETH. According to Santiment, Ethereum’s daily trading volume hit a two-week high of $35.17 billion, even as the market cap retreats from a month’s high to $386.66 billion at the latest.
Binance Inflow, Base Layer Activity, and TVL Challenge ETH buyers
Contrary to the aforementioned facts, Ethereum’s inflow to Binance and falling base layer activity, coupled with lesser Total Value Locked (TVL), challenge the ETH bulls.
On December 05, Binance experienced a 162,084 ETH inflow from a wallet to the exchange base, the largest move since May 23. Generally, such activity suggests the trader’s readiness to liquidate positions.
Meanwhile, the volumes on the Ethereum-based decentralized exchanges fell over 40% in a month, while decentralized application revenues reached a five-month low.
Furthermore, Ethereum’s leading Decentralized Applications (DApps) suffered a heavy fall in total value locked (TVL), from $100 billion to $76 billion in two months. Notably, TVL means the total value of the asset, ETH in this case, deposited in a decentralized finance (DeFi) protocol.
Technical Analysis Attracts Bearish Bias
Ethereum’s U-turn from the 200-day Exponential Moving Average (EMA), bearish candlestick formation, and downbeat signals from the Directional Movement Index (DMI) momentum indicator underpin downside bias surrounding the altcoin.
Ethereum Price: Daily Chart Lures Bears
On the daily chart, Ethereum price takes a U-turn from the 200-day EMA and portrayed the “Gravestone Doji” bearish candlestick at a multi-day high, suggesting further weakness in the quote.
Adding strength to the downside bias is the DMI indicator, as it’s Average Directional Index (ADX, red) line tops the Downmove (D-, Orange) line and the Upmove (D+, Blue) line, with the ADX and D- both being closer to the 25.00 neutral level, suggesting a notable presence of the downside momentum.
With this, the ETH is likely to break the immediate support of the 50% Fibonacci retracement of the April-August upside, $3,170.
However, a convergence of the previous resistance line from early October, ascending trendline support from late June, and the 61.8% Fibonacci retracement level, close to $2,750, appears to be a tough nut to crack for the ETH bears.
If the Ethereum price breaks the $2,750 support, the odds of witnessing a slump toward the 78.6% Fibonacci ratio of $2,150 can’t be ruled out.
Alternatively, the ETH rebound remains elusive as long as the price stays below the 200-day EMA hurdle of $3,455.
Beyond that, multiple resistances around $3,700 and the $4,000 psychological magnet could challenge the Ethereum buyers before directing them to the 23.6% Fibonacci retracement level of $4,112.
Also read: Bitcoin or Ethereum: Which Will Lead the Recovery in December?
