Ethereum Recovery Outpaces Bitcoin Despite Constant Selling at $4K

Why ETH Shows Stronger Recovery Than Bitcoin

Ethereum has demonstrated remarkable resilience compared to Bitcoin, with retail investors playing a crucial role in the cryptocurrency's recovery despite persistent selling pressure at the $4,000 level.

Key Market Developments

Retail Investors Drive ETH Recovery

Retail investors absorbed the majority of Ethereum's long liquidations but quickly stepped in to purchase ETH during the dip to $3,600. This buying behavior contrasts sharply with institutional whale activity, showing retail confidence in Ethereum's long-term prospects.

ETH Price Action vs Bitcoin Performance

While ETH price has rebounded to its average trading range, Bitcoin continues facing heavy selling pressure below $116,000. This divergence highlights Ethereum's stronger fundamental support despite similar market conditions.

Strategic Reserve Impact Falls Short

Despite $10.16 billion in strategic Ethereum reserves and a 19-day streak of inflows to spot ETH ETFs totaling $21.85 billion in holdings, selling pressure at $4,000 has prevented a breakout above long-term resistance levels.

Market Analysis and Technical Indicators

Liquidation Patterns Reveal Market Structure

Liquidation heatmap data shows ETH tapped long leverage liquidation levels at $3,600 on Thursday. Short positions remain vulnerable near $3,900, where the most intense selling occurred throughout the week.

Funding Rate Signals Potential Reversal

Ethereum's aggregated funding rate turned negative for the first time since June 25, following $115.8 million in ETH long liquidations over five hours. Many crypto traders interpret negative funding rates as buy signals for major cryptocurrencies.

Volume Analysis Shows Retail Strength

Cumulative volume delta analysis reveals retail investors (100-1,000 volume buckets) bore the brunt of long liquidations, while whales (10,000-1 million buckets) remained relatively inactive. This pattern suggests retail conviction in Ethereum's value proposition.

Current Market Position

ETH Recovery Momentum

Retail bulls have stepped in to buy the dip, positioning ETH to reclaim the point of control at $3,775. This level represents a critical technical milestone for continued upward momentum.

Bitcoin Comparison

While Ethereum shows signs of recovery, Bitcoin struggles to maintain support above $116,000, highlighting the relative strength in ETH's market structure.

Market Impact Factors

Trump Administration Tariff Effects

Following President Trump's announcement of new tariffs against Canada, Taiwan, South Korea, Vietnam, and other countries, both Bitcoin and Ethereum experienced sell-offs, though ETH's recovery has been more pronounced.

ETF Inflow Dynamics

The continuous inflows to spot ETH ETFs demonstrate institutional interest, though this hasn't translated into immediate price appreciation due to selling pressure at key resistance levels.

Trading Considerations

Risk Management

The cryptocurrency market remains highly volatile, with liquidation events demonstrating the importance of proper risk management. Traders should be aware of leverage concentration levels that could trigger further liquidations.

Market Sentiment Indicators

Negative funding rates, combined with retail buying activity, suggest potential for continued recovery if selling pressure diminishes at current resistance levels.

Outlook for Ethereum

Technical Levels to Watch

Key resistance remains at $4,000, while support has been established around $3,600. The $3,775 point of control represents an important intermediate level for trend continuation.

Fundamental Drivers

Strategic reserves and ETF inflows provide underlying support, though market timing for breakthrough moves remains uncertain given current selling pressure.

Disclaimer: This analysis is for informational purposes only and does not constitute investment advice. Cryptocurrency trading involves significant risk, and investors should conduct thorough research before making investment decisions.

For more Crypto, Web3, Blockchain & AI news visit : www.metamoonmedia.com