Ethereum (ETH) is showing renewed signs of strength as market sentiment shifts amid growing institutional interest and anticipation of the upcoming Pectra upgrade. After a 2% gain on Wednesday, ETH briefly broke past $1,800 but was rejected at the 50-day Simple Moving Average (SMA), highlighting lingering resistance in a long-standing downtrend channel. Despite this, bullish momentum may be building, driven by the largest net inflows into U.S. spot Ethereum ETFs since early February.
This article explores the latest developments shaping Ethereum’s price trajectory—including ETF inflows, exchange activity, technical patterns, and network upgrades—while offering a data-driven price forecast for traders and investors.
👉 Discover how market dynamics are aligning for a potential breakout
ETH ETF Sees Strongest Inflows Since February
After a prolonged period of outflows, U.S. spot Ethereum ETFs recorded $38.8 million in net inflows on Tuesday—marking the first positive day since April 4 and the largest single-day inflow since February 4. This shift comes on the heels of a 13% rally in ETH price, signaling renewed confidence among institutional investors.
Notably, Fidelity’s FETH fund led the charge with $32.7 million in purchases, followed by **Bitwise’s ETHW**, which added $6.1 million worth of Ethereum. These flows are particularly significant given the broader context: over the past two months, Ethereum ETFs had suffered nearly $1 billion in cumulative outflows since February 20.
At the same time, Ethereum’s dominance in the altcoin market has dipped below 7%, suggesting capital rotation into smaller-cap digital assets. However, sustained institutional buying could reverse this trend and re-energize ETH’s price momentum.
While ETF inflows signal long-term conviction, short-term traders appear to be taking profits. According to Coinglass data, over $150 million in ETH flowed into exchanges over the past two days, indicating that spot investors may be locking in gains amid recent volatility.
This divergence—between institutional accumulation and retail profit-taking—creates a tug-of-war that could define Ethereum’s near-term direction.
Pectra Upgrade Looms: Key Network Enhancements Ahead
Scheduled for May 7, 2025, the Pectra upgrade is set to bring several critical improvements to the Ethereum mainnet:
- Wallet recovery options to enhance user security and accessibility
- Transaction batch processing for improved scalability and lower fees
- Blobspace expansion, increasing data availability for Layer 2 rollups
- Staking limit raised to 2048 ETH per validator, enabling larger institutional participation
These upgrades aim to strengthen Ethereum’s position as the leading smart contract platform by improving usability, security, and scalability. Historically, major network upgrades have preceded or coincided with bullish price movements, as they reinforce confidence in Ethereum’s long-term roadmap.
Market participants are already pricing in some of these expectations, but any delays or technical issues could weigh on sentiment.
👉 Stay ahead of major crypto events and market-moving upgrades
Technical Analysis: Testing Resistance in a Bearish Channel
Since December 16, Ethereum has been trading within a well-defined descending channel on the daily chart. This pattern reflects persistent selling pressure, with each rally meeting resistance near the upper boundary.
Recently, ETH made another attempt to break higher, briefly surpassing $1,800 before being rejected at the 50-day SMA—a key short-term moving average that now acts as dynamic resistance.
Key Levels to Watch:
- Resistance: Upper boundary of the downtrend channel (~$1,850)
- Support: $1,688 – a break below could signal further downside
- Psychological Target: $2,000 – reclaiming this level would restore strong bullish sentiment
On the ETH/USDT daily chart, indicators show mixed signals:
- The Relative Strength Index (RSI) remains above neutral (50), suggesting underlying buying pressure.
- The Awesome Oscillator (AO) shows shrinking green bars below the zero line, indicating weakening bullish momentum.
- The Stochastic Oscillator (Stoch) has entered overbought territory, raising the possibility of a short-term pullback.
A decisive close above the downtrend channel’s upper boundary would be a powerful bullish signal—potentially turning resistance into support and opening the path toward $2,000. Conversely, failure to sustain gains could lead to another leg down toward $1,600 or lower.
Futures Market Sentiment: Liquidations Favor Short Squeeze Potential
In the last 24 hours, approximately **$81.8 million in futures positions were liquidated**, with longs accounting for $30.7 million and shorts making up $51.1 million. The higher short liquidations suggest that bearish bets are vulnerable to a squeeze if upward momentum accelerates.
With ETF inflows returning and technical indicators hovering near inflection points, even a modest breakout could trigger cascading short covers—amplifying gains in a low-liquidity environment.
However, traders should remain cautious. High exchange inflows often precede downward price pressure as holders prepare to sell. Until ETH demonstrates a sustained move above $1,850 with strong volume, the broader trend remains range-bound within the bearish channel.
Frequently Asked Questions (FAQ)
What caused the recent surge in Ethereum ETF inflows?
The rebound in ETF demand follows a 13% price increase and growing optimism around the Pectra upgrade. Institutional investors, particularly through Fidelity and Bitwise, are re-entering the market after months of net outflows.
Is Ethereum still in a downtrend?
Yes. ETH has traded within a descending channel since December 2024. Until it breaks and closes above the upper resistance (~$1,850), the technical bias remains bearish-to-neutral.
What happens if ETH breaks above $1,850?
A confirmed breakout could trigger a short squeeze and attract new buyers. The next major target would be $2,000—the psychological level that marks a full recovery from recent losses.
How might the Pectra upgrade affect ETH’s price?
Network upgrades typically boost investor confidence. Features like wallet recovery and staking enhancements improve usability and security—fundamental catalysts that can support long-term valuation.
Why are exchange inflows concerning?
Large inflows suggest traders are moving ETH onto exchanges to sell. While not a guaranteed bearish signal, it increases selling pressure and often precedes price corrections.
What are the core keywords for this analysis?
Ethereum price prediction, ETH ETF inflows, Pectra upgrade 2025, ETH technical analysis, Ethereum downtrend channel, spot Ethereum ETF, ETH price forecast 2025.
👉 Monitor real-time market shifts and position yourself before the next move
As Ethereum stands at a technical crossroads—with ETF flows turning positive and network upgrades on the horizon—the coming weeks could determine whether this rally evolves into a sustainable bull run or fades within an entrenched bearish structure. Traders should watch for a confirmed breakout above $1,850 and declining exchange reserves as key confirmation signals.
With institutional support returning and fundamentals strengthening, Ethereum may be laying the groundwork for a broader recovery—even as short-term volatility persists.