Ethereum Price Drop Under Key Support with Rising ETF Outflows

Ethereum (ETH), the second-largest cryptocurrency by market cap, has had a rocky start to December. After weeks of holding strong, ETH has slipped below a critical support range, sending shockwaves through the crypto community. But is this just another dip—or the setup for a powerful reversal?

Let’s break it down in simple terms, with key insights on price movement, ETF activity, and what patterns on the charts are telling us.

Ethereum Dips Below Key Support – What Happened?

In recent days, Ethereum dropped into the $2,800–$2,850 zone—a price range it had successfully defended for much of the last quarter. The decline came after repeated failures to break above the $2,950–$3,020 resistance zone. This resistance hardened particularly around November 25, when ETH decisively broke beneath support, raising red flags for traders.

Zooming out, ETH has been in a downtrend since early October, when it was trading near $3,800. Since then, each bounce has faced stiff resistance, forming a series of lower highs—a classic bearish signal. That trend accelerated in mid-November, pushing ETH as low as $2,740.

If the current slide continues, chart analysts point to the next key support area around $2,590–$2,620. This level has historically acted as a stabilization zone. A break below that? Ethereum might revisit the $2,370 range, where it previously consolidated in July.

ETFs Show Outflows, But Big Institutions Are Still Buying

One of the most interesting twists in this story comes from the ETF market. On December 1st, Ethereum-tied ETFs saw a substantial one-day outflow—approximately $79 million. Grayscale’s ETHE product saw $20.3 million walk out the door, and BlackRock’s ETHA fund had even more—$31.6 million in redemptions.

But here's the kicker: BlackRock was still buying. On the same day, the asset management giant added $26.7 million worth of ETH to its holdings. That suggests that while ETF investors may be taking profits or repositioning, some heavyweight institutions still believe in Ethereum’s long-term potential.

So, what does this mean? Simply put: short-term sentiment is shaky, but long-term confidence hasn’t gone away.

Falling Wedge Pattern: Could a Rebound Be Next?

Technical traders, take note—Ethereum is forming a falling wedge pattern on the 12-hour chart. This pattern is often associated with a potential trend reversal and typically signals a slowdown in selling pressure.

The wedge’s lower boundary currently lines up with a key support zone around $2,450–$2,500—a potential springboard for a rebound. On the flip side, a breakout to the upside could target the $3,000–$3,050 area, the upper resistance of the wedge.

While Ethereum hasn’t broken out yet, the narrowing wedge suggests volatility is tightening. This type of structure often precedes explosive moves, so traders are watching closely for a breakout or breakdown.

Final Thoughts: Is This a Buying Opportunity?

Ethereum is in a classic “inflection point” scenario. Short-term traders are cautious, ETF outflows show hesitation, and price action is stuck in a downtrend. But patterns like the falling wedge—and large institutional buying from names like BlackRock—are telling a different story.

If you’re a long-term believer in ETH, this drop could present a potential buy-the-dip opportunity—provided you manage risk and stay informed. For short-term traders, the key is watching for a breakout from the wedge pattern to signal a clearer direction.