Ethereum Price Below $4,000 Again: A Sign of Accumulation?

Ethereum (ETH) price has fallen back below $4,000 in recent trading, dropping as low as $3,999. However, analysts emphasize that this movement is not panic selling, but investors' tendency to accumulate. Ethereum then recovered to $4,037, down 2.91% in the last 24 hours.

Experts say this decline is due to various factors. Technical breakouts, macroeconomic uncertainties and mass liquidations are among the factors that trigger market volatility. BTC Markets analyst Rachael Lucas explained that the loss of $4,200 support led to a liquidation of $212.9 million in Ethereum.

On the other hand, the US Federal Reserve's 25 basis point rate cut in September did not meet investor expectations and did not create a lasting rally. Chairman Jerome Powell's announcement that they would pause on interest rate cuts reduced investors' willingness to take risks. In addition, spot exchange traded funds (ETFs) for Ethereum have also seen a significant decline. In September, ETH ETFs saw net inflows of just $110 million, compared to more than $3.8 billion in August.

On-chain data, however, paints a different picture of investor behavior. This week, 420,000 ETH was reported to have been withdrawn from exchanges. CoinW Chief Strategy Officer Nassar Achkar said that Ethereum exchange balances have fallen to their lowest level in nine years and institutional investor confidence has increased. "The ongoing exodus from exchanges reveals that whales and retail investors prefer self-custody and staking returns to short-term trades," Achkar said. This trend could create a supply shock in the coming period and pave the way for Ethereum's rise to a new all-time high."