Ethereum (ETH) is experiencing its worst October performance in eight years, with a 13% drop so far this month. After a strong September that saw nearly a 9% gain, expectations were high for continued growth in October, a historically bullish month for ETH. However, the current decline has analysts concerned about further short-term pain, particularly as institutional interest wanes.
As of now, ETH is trading around $2,330, down 4.3% over the past week. Analyst Alaoui Capital warns that the cryptocurrency is approaching a critical support zone between $1,850 and $1,920, suggesting a potential drop below the $2,000 psychological level. The analyst also hinted at a possible relief bounce if the price sweeps into this zone and faces strong rejection. Meanwhile, another analyst, Ted, predicts a modest decline to $2,200 if ETH fails to reclaim $2,350 soon.
Institutional demand for ETH is another growing concern. Spot ETH ETFs have seen significant outflows, with $220 million leaving the funds last week. This trend suggests that pension funds, hedge funds, and other conservative investors are reducing their exposure, forcing major issuers like BlackRock, Grayscale, and Fidelity to sell ETH to meet redemptions. Arthur Hayes, co-founder of BitMEX, recently sold over $15 million in ETH, further adding to the bearish sentiment.
Despite the gloomy outlook, some analysts remain optimistic. Joep Gerla believes ETH might trade in a manipulation zone before rallying to as high as $3,600. Similarly, X user Wealthmanaged anticipates a massive bounce beyond $3,000 from the current flag pattern.