As the crypto market bounces from the latest shakeout, Ethereum (ETH) and investment products based on the King of Altcoins recorded a remarkable single-day performance, potentially setting the stage for further recovery.
Ethereum ETFs Recover Amid Market Bounce
Ethereum-based spot Exchange-Traded Funds (ETFs) recovered from Tuesday’s weak performance and recorded their best single-day in nearly two months, with $169 million in inflows on Wednesday.
According to SoSoValue data, the category saw the highest netflow since January 14, when it drew in $175 million. Notably, the mid-January crypto market correction triggered massive outflows for investment products, with funds based on the two largest crypto assets, Bitcoin (BTC) and ETH, showing the weakest performance.
Ethereum ETFs saw a five-week negative streak, bleeding $1.38 billion during this period. However, the funds ended their weekly outflow run last week after posting inflows worth $80.46 million.
So far, the products have drawn in $197.35 million this week, potentially setting a base to register their best weekly performance since January 16, when it closed the week with $479.04 million.
Alex Kuptsikevich, chief market analyst at FxPro, recently highlighted that the strength of crypto ETFs, despite growing geopolitical tensions and financial markets’ selloff, could be seen as “a victory for cryptocurrencies,” suggesting that some traders may be considering digital assets as a safe haven.
Meanwhile, James Butterfill, head of research at CoinShares, emphasized that “recent client discussions have been almost entirely focused on identifying entry points rather than reducing exposure to the asset class.”
ETH At A Structural Decision Point
Ethereum’s price climbed 12% on Wednesday, its highest level since February 4. Amid the market recovery, the cryptocurrency reclaimed the $2,100 barrier and reached a one-month high of to $2,199 before retracing.
The king of altcoins has been trading between the $1,825-$2,150 levels since the early February breakdown, unable to break past the upper boundary of its local range.
Analyst Rekt Capital pointed out that ETH closed the month just below a crucial multi-year ascending trendline, which has served as macro support and a decisive directional point over the years.
This places the price in a structurally bearish position, as it enables a monthly retest of this level as resistance instead of support. The analyst emphasized that if this trendline becomes a resistance, it would confirm a breakdown from the macro structure and increase the likelihood of a deeper move into a key horizontal zone and historical demand cluster situated around the $1,600 region.
“If Ethereum rejects from the trendline and the current bounce retraces in full, that rejection would signal the trendline dissipating as support and confirm the breakdown scenario,” he stated.
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However, he noted that bearish continuation is not confirmed yet, explaining that if ETH manages to reclaim the trendline as support in the monthly timeframe, the horizontal zone and historical supply area around the $2,250-$2,500 levels could act as a relief cluster “where price may rally before the market determines its next directional move.”
“For now, Ethereum remains at a structural decision point around the multi-year trendline,” he concluded.
Featured Image from Unsplash.com, Chart from TradingView.com
