Ethereum’s price decline deepened on August 2, slipping 4% over the past 24 hours to around $3,500, extending its 7-day loss to 6.3%.
The drop comes as Ethereum exchange-traded funds (ETFs) recorded their first net outflow in 20 days, signaling a pause in institutional accumulation after weeks of strong inflows.
ETF Outflows Break Positive Streak
On August 1, Ethereum ETFs saw $152.3 million exit the market, despite $5.43 billion pouring in during July. Analysts attribute this shift to profit-taking after ETH’s 34% surge over the past month. Data from Coinglass suggests that $257 million worth of ETH long positions could be at risk if prices test $3,424, adding pressure to the market’s short-term outlook.
SharpLink Gaming’s $52.6 million ETH purchase continued corporate interest in the asset. However, the buy was not enough to counterbalance the selling pressure from larger market players.
Correlation With Bitcoin Adds Downside Risk
ETH’s 90-day correlation with Bitcoin remains high at 0.89, meaning Bitcoin’s price movements heavily influence Ethereum. Bitcoin’s own decline below $116K (-2.6% in 24h) triggered cross-market liquidations, further weighing on ETH. Weak U.S. jobs data—just 73,000 jobs added in July versus 200,000 expected—also spurred concerns about stagflation, leading to risk-off sentiment across financial markets.
This shift in sentiment is visible in the Fear & Greed Index, which dropped from 57 (Greed) to 51 (Neutral) in recent days.
Technical Levels to Watch
Analyst Michaël van de Poppe, who predicted a correction last week, pointed to a lower time frame bearish divergence as the key signal. He identifies $3,300 as the first major support zone, giving it a 70% probability of sparking a short-term bounce. A break below this could push prices into the $3,000–$3,100 range, which he considers the best long-term entry point for the second half of 2025.
Van de Poppe’s chart outlines two critical accumulation areas: a higher band near $3,300 for potential short-term reversals and a deeper zone near $3,000 for more aggressive, long-term positioning.
Smart Money Quietly Accumulating
Despite the market’s near-term weakness, some investors are quietly taking advantage of the pullback. Analyst Peter Maliar notes that accumulator wallets are showing their strongest inflows in years—wallets typically associated with long-term holders rather than active traders. Historically, such activity has preceded major price rallies, suggesting that “smart money” may be positioning ahead of the next upward wave while retail traders remain cautious.
What Comes Next for Ethereum
The coming days could prove decisive for Ethereum’s trajectory. A rebound from $3,300 would suggest the market is entering a consolidation phase after July’s rally. However, if macroeconomic pressures and Bitcoin’s weakness continue to drag sentiment lower, ETH could retest deeper support levels—potentially offering one of the most attractive buying opportunities of the year for long-term investors.
The information provided in this article is for informational purposes only and does not constitute financial, investment, or trading advice. Coindoo.com does not endorse or recommend any specific investment strategy or cryptocurrency. Always conduct your own research and consult with a licensed financial advisor before making any investment decisions.
Alexander Stefanov
Reporter at Coindoo
Alex is an experienced financial journalist and cryptocurrency enthusiast. With over 8 years of experience covering the crypto, blockchain, and fintech industries, he is well-versed in the complex and ever-evolving world of digital assets. His insightful and thought-provoking articles provide readers with a clear picture of the latest developments and trends in the market. His approach allows him to break down complex ideas into accessible and in-depth content. Follow his publications to stay up to date with the most important trends and topics.
Source: https://coindoo.com/market/ethereum-correction-deepens-but-smart-money-buys-signal-possible-rally-ahead/