Ethereum (ETH) Struggles with Tight Trading Range Amid Bearish Trends

Ethereum (ETH) is encountering persistent challenges in the short term, marked by constrained price movement within a narrow trading range and increasing bearish sentiment across the market. Investors are closely watching critical support levels for signs of a possible rebound or further decline.

Investor Sentiment Turns Bearish

In recent weeks, Ethereum has fluctuated between $4,200 and $4,500, failing to break out of this restrictive zone for the second consecutive week. The broader cryptocurrency market has seen similar declines, with Bitcoin (BTC) falling below the $10,000 threshold, further dampening market sentiment.

On-chain analytics firm Santiment shed light on these trends, stating, "Traders are increasingly forecasting bearish scenarios, expecting Bitcoin to drop below $10,000 and Ethereum below $3,500." Despite the negative outlook, Santiment added an insightful perspective: "Markets often move contrary to public sentiment, which could make this an ideal buying signal." This contrarian dynamic underscores the importance of monitoring sentiment as a potential indicator of impending price corrections or reversals.

Plummeting Trading Volume Indicates Weak Demand

On-chain data from analytics provider Glassnode highlights a sharp decline in Ethereum’s spot trading volume, which fell from $18.5 billion on August 22 to $2.6 billion by September 8—a striking 85% drop. This drop reflects waning investor engagement and exposes potential vulnerabilities in Ethereum's price framework.

While cumulative volume delta (CVD) for spot trading has recently shown slight improvements due to reduced selling pressure, trading activity remains far below the levels witnessed in late August. These metrics indicate weak demand, but the easing pressure on CVD offers a glimmer of hope for a potential stabilization that could lead to a reversal in trend.

Institutional demand for Ethereum also remains subdued. According to CoinTelegraph, spot ETFs linked to Ethereum experienced net outflows of more than $1.04 billion over six consecutive trading sessions, amplifying bearish pricing pressure in the market.

Technical Analysis: ETH Risks a Deeper Drop

Ethereum's technical setup shows mounting pressure, with prices testing critical support levels. Data from CoinTelegraph Markets Pro and TradingView reveals ETH is hovering near the lower trendline of its symmetrical triangle pattern on the daily chart at $4,280. A daily close below this support level could ignite further selling pressure, potentially driving ETH down to $3,600—a decline of approximately 16% from its current price.

Michael van de Poppe, founder of MN Capital, commented on this situation: "The ideal scenario for Ethereum would involve a rebound from the $3,500–$3,800 demand zone." Analyst Ted Pillows provided additional insights, stating, "Significant liquidity clusters are concentrated in the $3,600–$4,000 range. Ethereum could consolidate in that zone before reversing upward."

Pillows also highlighted the possibility of another support level emerging at $3,745 if the $4,000 range fails to hold. He outlined a bearish but potentially short-lived scenario wherein liquidity sweeps lower before Ethereum stages a recovery.

"$ETH has decent liquidity clusters around the $3,600-$4,000 level.
Ethereum price action is also looking weak due to macro uncertainty and weak ETF demand.
It looks like a sweep of lower liquidity could happen before reversal."
— Ted Pillows (@TedPillows) September 9, 2025

This cautious outlook emphasizes the importance of monitoring Ethereum’s interaction with key support levels to anticipate future price movements.

Outlook: A Path Towards Reversal or Extended Decline

Ethereum’s short-term trajectory remains uncertain amid declining macroeconomic stability and weak spot ETF demand. The sharp drop in trading volumes and bearish sentiment further weigh on its performance. While technical indicators point to the possibility of further downside, contrarian investors may view this as an opportunity to accumulate Ethereum at discounted prices.

Key support levels to watch include $4,000, $3,745, and $3,600, as stability around these areas could signal the potential for a rebound. Alternatively, failure to hold these thresholds may expose ETH to deeper corrections. Regardless, Ethereum’s price movement in the coming weeks will likely be shaped by a combination of macroeconomic factors, institutional activity, and trader sentiment, making it a pivotal time for monitoring market developments.