Despite risks of a vulnerable dip toward $3,950-$4,100 support, ETF inflows, treasury adoption, and RWA tokenization strengthen ETH's medium-term outlook.Despite risks of a vulnerable dip toward $3,950-$4,100 support, ETF inflows, treasury adoption, and RWA tokenization strengthen ETH's medium-term outlook.

Ethereum’s Short-Term Pain Could Spark its Biggest Rally Yet

3 min read

Ethereum (ETH) saw a modest 1.2% gain on Thursday to trade at $4,250 after falling sharply this week as investors closely watch macroeconomic indicators.

New data suggest that the short-term turbulence may be the reset that strengthens the leading altcoin’s next upward leg.

Ethereum is showing a market split. Spot flows remain subdued while futures markets run hot, which highlights a diverging short- and medium-term. According to CryptoQuant’s analysis, exchange reserves of ETH have edged higher in recent days, which points to an increased availability for selling that could create near-term price pressure, though the buildup is not yet at worrying levels.

On the derivatives side of things, the picture looks far more heated. Futures taker CVD over the past 90 days remains skewed toward sells, which indicates that traders are hesitant to take on fresh long exposure around $4,300. Adding to the caution, Ethereum’s futures volume “bubble map” is flashing red clusters near recent highs. This is a sign of overheating that often leads to forced liquidations and sharp volatility swings.

In the short term, CryptoQuant warned that leverage-heavy positioning makes Ethereum vulnerable to a correction toward the $3,950-$4,100 support band, particularly if a liquidation cascade unfolds. However, the medium-term outlook remains constructive and is backed by strong structural drivers.

Ongoing inflows into ETH-based ETFs, corporate adoption of Ethereum for treasury strategies, and its expanding role in real-world asset (RWA) tokenization continue to strengthen this demand.

The likely outcome, according to market watchers, is a “volatility reset” over the coming weeks. Short-lived dips triggered by liquidations could clear excess leverage and set the stage for renewed spot-driven buying. If exchange reserves stabilize and sell-side dominance in futures subsides, Ethereum has room to reclaim $4,300 and extend its rally.

Is the “Flippening” Finally Here?

Ethereum treasury companies have played a major role in cushioning the price of the crypto asset this year. In fact, analyst Miles Deutscher found that Ethereum is increasingly challenging Bitcoin’s dominance in corporate treasury stock trading.

Trading volumes in ETH-focused firms such as BitMine Immersion Technologies and SharpLink Gaming have surged significantly. BMNR even overtook Michael Saylor’s Strategy in daily volume. BMNR now averages nearly 48 million shares traded daily, compared with MSTR’s 12 million, while its dollar volume ranks tenth among US stocks at $6.4 billion. BitMine has also become the largest ETH treasury holder with 1.5 million ETH.

Meanwhile, weekly ETH spot trading volumes have tripled Bitcoin’s, in what appears to be a real-time “flippening.”

The post Ethereum’s Short-Term Pain Could Spark its Biggest Rally Yet appeared first on CryptoPotato.

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