Ethereum Price Approaches $4,000 Breakout with Fed Cut Odds and ETF Inflows in Alignment
Ethereum’s price is currently sitting at $3,682.28 as of August 6, experiencing a 2.41 percent rally on the day and an 18 percent increase since the beginning of 2025. This upward movement has been fueled by changing expectations surrounding U.S. monetary policy and escalating trade tensions. The recent drop in July’s ISM Services PMI to 50.1, its lowest level in over a year, along with the addition of only 73,000 jobs in nonfarm payrolls compared to forecasts of around 104,000, has led to a 90 percent likelihood of a rate cut in September according to CME FedWatch odds. These circumstances have weakened the dollar’s yield advantage, making assets like Ethereum more appealing due to their non–interest-bearing nature. Additionally, President Trump’s imposition of new 25 percent tariffs on Indian imports, increasing the total U.S. duty to 50 percent, has added fresh uncertainty to global inflation expectations, providing further support for Ethereum as a safe-haven asset.
Institutional interest in Ethereum has been growing, with U.S.-listed Ethereum ETFs attracting $73.22 million in net inflows on August 5. BlackRock’s ETHA fund received $78 million, marking a record day for institutional demand. In contrast, there were $196 million in redemptions for spot Bitcoin funds as investors shifted capital towards Ethereum. BlackRock’s transfer of almost 102,000 ETH to Coinbase Prime, following cumulative outflows of over $667 million from IBIT and ETHA on August 4, is viewed as a prelude to liquidation by the markets. Despite these outflows, the total open interest in ETH futures remains high at $46.78 billion, demonstrating sustained institutional involvement even as leverage resets amid consolidation.
On-chain metrics indicate a pattern of accumulation and profit-taking. The Exchange Supply Ratio for Ethereum has dropped to a multi-year low of 0.13, showing a decrease in the share of ETH held on centralized platforms. Net outflows of $42.64 million from the spot market on August 6 further confirm holders moving tokens into cold storage or for staking. However, there has been a negative swing of 224 percent in on-chain whale netflow over the past week, indicating that large addresses are realizing gains following Ethereum’s peak near $3,945 in late July. The Estimated Leverage Ratio across exchanges is at 0.76, its lowest reading in months, suggesting reduced speculative activity. This divergence in signals reflects a sophisticated derivatives market where traders are taking profits before committing new funds.
In terms of technical analysis, ETH-USD has established a symmetrical triangle pattern between $3,556 and $3,672 on the daily chart. The 100-day moving average at $3,334 is trending upwards to intersect the price. Immediate resistance lies at $3,672, in line with the upper boundary of the triangle and the March high. A clear break above this level could lead to $3,900 and eventually the 2024 high at $4,100. Conversely, a breach below $3,556 could trigger a deeper correction towards $3,300 or even the 100-day MA. Momentum indicators suggest a cautious outlook as the RSI has pulled back from overbought levels and Bollinger Bandwidth has tightened, hinting at an imminent directional move.
When comparing Ethereum’s market cap of $438.3 billion to Bitcoin’s value, ETH appears undervalued in relation to its growth potential driven by the expanding adoption of DeFi and Layer-2 solutions. Price predictions for the end of 2025 range from $4,531 to $5,019 with an average consensus around $4,688 based on technical models. Long-term forecasts for 2027 and 2030 posit price targets between $10,133 to over $12,000 and $30,372 to $36,694 respectively. These optimistic projections are supported by factors such as institutional ETF development, network upgrades through The Merge, and increasing staking revenues. However, more conservative estimates foresee prices ranging from $21,185 to $25,866 by 2029 in the presence of ongoing macroeconomic challenges.
Risk factors that could impact Ethereum’s upward trajectory include difficulties in regaining triangle resistance, a resurgence in the dollar’s strength due to unexpected Federal Reserve communications, and a potential reversal in ETF flows if outflows persist. On-chain risks stemming from significant whale profit-taking could erode market confidence if Ethereum revisits support levels below $3,500. Nevertheless, derivative metrics suggest a balanced risk position, with positive funding rates, long/short ratios favoring long positions, and contained liquidation volumes indicating readiness for a breakout once catalysts align.
In conclusion, the outlook for Ethereum suggests a period of consolidation within a narrow range, signaling an impending directional move. The convergence of macroeconomic factors and institutional interest underscores
