Ethereum Faces Tough Path To $3.9k As Sentiment And Demand Fizzle

Weak demand from spot Ethereum ETFs, soft derivatives data, and macro fears have left Ether struggling to sustain $3,400 despite signs of steady onchain activity.

Ethereum ETF outflows and cautious traders show limited confidence in ETH price going higher for now.

Low derivatives premiums suggest a muted outlook for Ether’s price.

Ether (ETH) fell 11% over the past week, even after reaching the $3,400 mark on Saturday. The drop came alongside a 4% correction in the Nasdaq index, which erased gains from the previous two weeks. Traders are now debating whether ETH still has chances to reclaim the $3,900 level.

Concerns about global economic growth surfaced after weak quarterly results from consumer-focused companies and renewed worries over high valuations in the artificial intelligence sector. Meanwhile, the longest-ever US government shutdown continues to hurt the economy.

Ether futures are trading at a 4% premium to spot markets, unchanged from the previous week. The data shows a limited appetite for bullish positions, although it has not yet approached panic levels below 0%.

Under normal market conditions, this premium typically sits between 5% and 10% to account for the longer settlement period.

Related: Cathie Wood’s ARK Invest adds BitMine shares as it offloads $30M in Tesla stock

Market anxiety grew after US consumer sentiment expectations plunged to their lowest levels ever, according to a University of Michigan survey.

November’s reading, released Friday, was the second weakest since at least 1978 and was largely blamed on the ongoing US government spending shutdown, AP reported.

Source: CoinTelegraph