Institutional Confidence Grows with ETF Inflows

Ethereum (ETH) is demonstrating resilience amid a wider market downturn, with its price consolidating as institutional interest continues to build. Despite a 5.3% dip over the last day to trade around $4,443, the asset remains up 7% for the week and 3.4% for the month, holding just 10% below its August 24 peak of $4,946.

A significant driver of this stability is the consistent demand for spot Ethereum exchange-traded funds (ETFs). According to data from SoSoValue, these funds recorded net inflows of $420 million on October 7, marking the seventh consecutive day of positive flows. Over the past month, inflows have totaled $803 million, pushing the combined assets held by spot Ethereum ETFs above $30 billion. This sustained institutional buying is helping to absorb circulating supply and cushion the price against broader market volatility.

Trading activity has also picked up, with 24-hour spot volume increasing 27% to $51.9 billion. Meanwhile, data from Coinglass shows that while Ethereum futures volume rose 54% to $124.2 billion, open interest declined by 5.5%. This drop in open interest suggests that over-leveraged positions have been cleared out, a development that often precedes a period of renewed price stability.

Shrinking Supply Adds to Bullish Case

Beyond ETF demand, Ethereum’s supply dynamics are becoming increasingly favorable. The amount of ETH held on exchanges has fallen to a three-year low of 17.4 million, a sharp decrease from 28.8 million in 2022. This trend indicates that more investors are moving their assets into long-term holding strategies rather than keeping them ready for sale.

The supply squeeze is further amplified by growing corporate adoption, with public companies now holding an estimated 3.6 million ETH in their treasuries. Additionally, the EIP-1559 network upgrade continues to exert deflationary pressure by permanently burning a portion of all transaction fees, steadily reducing the total available supply over time.

Technical Outlook for ETH

From a technical standpoint, Ethereum’s daily chart shows the price consolidating within its Bollinger Bands. ETH is currently trading near $4,450, finding short-term support at the middle band around $4,313. The next key resistance level to watch is the upper band at approximately $4,731.

The Relative Strength Index (RSI), a key momentum indicator, sits at a neutral 53, suggesting the market is balanced and not in overbought or oversold territory. This balance, combined with strong trading volumes, points to a potential buildup for a significant price move once volatility contracts.

If buying pressure can push the price decisively above the $4,700 resistance, Ethereum could quickly retest the $4,900–$4,950 range established in August. A successful break of this level would open the door to a potential move toward the psychological $5,000 mark. Conversely, a daily close below the $4,300 support could signal weakness, potentially leading to a deeper correction toward $3,900, where the 50-day moving average and the lower Bollinger Band converge.