Key Insights:
Decreased spot buying and rising spot Ethereum ETF outflows indicate weak demand, posing a risk for further Ether losses.
The bear flag pattern for Ether suggests a potential 20% price drop to $3,100.
Ether (ETH) dipped to $3,800 on Tuesday, unable to maintain the $4,000 mark as spot Ethereum ETF investors continued to redeem assets. This was compounded by technical indicators suggesting a deeper correction for ETH prices.
Ether price faces “significant resistance” at $4,000
Ether’s recovery of 16% from a low of $3,500 on October 11 was hindered by selling pressure near the $4,000 psychological threshold.
This demonstrates that “there is significant resistance at $4K,” stated trader Philakone in an X post on Monday.
Related: BitMine’s Lee argues that Ether’s ‘price dislocation’ signals a buying opportunity
It’s noteworthy that the last rejection for the ETH/USD pair from this level occurred in December 2024, preceding a 66% price decline, as illustrated in the chart below.
Therefore, bulls must drive and maintain the price above $4,000 to secure a recovery.
“Breaking this level has been challenging for the bulls and is crucial in the short/mid-term,” noted analyst Daan Crypto Trades in a recent X post.
A decisive close above this mark will position ETH “back into the previous price range and leave the current lows behind,” the analyst stated, adding:
“A significant battle is anticipated around the ~$4.1K level.”
This level “determines whether this pullback leads to a deeper correction or just a minor reset,” commented fellow analyst Jas Crypto, adding:
“If bulls protect $4K, momentum could rebuild toward $5K.”
As Cointelegraph reported, bulls need to push Ether above the $4,000-$4,300 supply zone to indicate the start of a new uptrend.
Absence of new buyers keeps ETH below $4,000
Ether’s capacity to remain above $4,000 seems constrained at present due to a lack of buyers.
The spot volume delta metric, which measures the net difference between buying and selling trade volumes, shows that net spot buying on exchanges remains negative, despite recent recovery efforts.
This implies that a price rebound may not have the necessary momentum from consistent buying pressure, potentially resulting in a deeper pullback.
Without sufficient demand, any breakout attempt may lack the strength to elevate ETH above critical levels.
Dwindling demand for spot Ethereum ETFs has also been observed, with these investment products experiencing outflows six times out of the last eight days, according to data from SoSoValue.
On Monday alone, Ether ETFs lost $145.7 million, summing total net outflows over the past eight days to $640.5 million.
For bulls to regain momentum toward $5,000, ETF inflows must revive and new ETH buyers must emerge.
Ether’s bear flag breakdown targets $3,100
ETH price is anticipated to continue its downward trend following the confirmation of a bear flag pattern.
Over the past 14 days, Ether’s price action has created a bear flag on the 12-hour chart, as shown in the figure below. The price fell below the flag’s lower boundary at $4,000 on Tuesday, indicating a significant breakdown.
The target derived from the flagpole’s height suggests a price around $3,120, representing a decline of about 20% from the current levels.
The relative strength index remains below 50, indicating that market conditions still favor a downward trend.
Despite this bearish sentiment, traders are optimistic regarding Ether’s potential, referencing bullish signals from credit conditions and ongoing buying from Ethereum treasury firms.
Analyst Jelle remarked that Ether is merely retesting a key breakout level around $4,000 before resuming its upward trajectory.
“This appears primed for a swift upward expansion.”
Based on sentiment in CT, one might think $ETH is struggling – yet it’s merely holding the breakout area as support.
This seems very ready for a quick upward surge.
Shakeouts appear to be effective, it seems. pic.twitter.com/IUpfnpf5VQ
— Jelle (@CryptoJelleNL) October 15, 2025
This article does not provide investment advice or recommendations. Every investment and trading decision entails risk, and readers should conduct their own research before making any decisions.
