Ethereum (ETH) continues to trade within a narrow range, struggling to gain momentum as market volatility cools down after a turbulent week. The world’s second-largest cryptocurrency remains locked between key resistance and support zones, with traders closely watching for signs of a breakout.
According to prominent crypto analyst Ted Pillows, Ethereum’s short-term outlook is shaped by the formation of strong liquidity clusters on both ends of its current price range. Using data from Coinglass, Pillows identified two critical zones — one between $3,900 and $4,200 acting as resistance, and another near $3,750 providing a crucial support area.
Despite recent price stagnation, Ethereum remains a central focus for traders looking for technical clarity ahead of potential market moves.
Heavy Liquidity Builds Between $3,900 and $4,200
In a recent post on X (formerly Twitter), Pillows shared a heatmap analysis showing a dense band of liquidity between $3,900 and $4,200. This range represents a zone where large sell orders have accumulated, suggesting many traders expect to take profits or open short positions once ETH revisits this area.
“The upper band is filled with significant resting liquidity, indicating that market participants are preparing for selling pressure if Ethereum reaches that level,” Pillows explained.
This means that unless Ethereum manages to break through this upper boundary decisively, the price could face rejection again, similar to previous attempts seen throughout October. A sustained breakout above $4,200 could, however, signal a potential shift in momentum and open the door for a broader rally targeting $4,500–$4,700.
$3,750 Emerges as Critical Support
On the downside, Pillows highlighted the $3,750 zone as a key support level and a magnet for liquidity. According to his analysis, this price point is attracting significant bids, making it a possible area for price reversal if Ethereum experiences a pullback.
The analyst noted that the current setup could lead to a liquidity sweep, a common market phenomenon where the price dips into a high-liquidity area to trigger stop losses and fill large buy orders before reversing direction.
“If the liquidity sweep scenario plays out, Ethereum could briefly drop toward $3,750 to absorb liquidity, then rebound sharply toward the $3,900–$4,200 zone,” Pillows added.
Such a move would be consistent with Ethereum’s past trading behavior, where price corrections often precede upward recoveries driven by renewed buying pressure.
Traders Expect Short-Term Volatility
Ethereum’s price has remained relatively stable near $3,800, posting a modest 0.44% daily gain as of the latest data. However, its trading volume has dropped by 53.83% to $17.57 billion, indicating that many traders are waiting on the sidelines for a clearer directional signal.
Market analysts suggest that a short-term dip toward $3,750 could be followed by a potential 10% rebound, targeting the upper resistance band near $4,200. However, the probability of this outcome depends heavily on broader market sentiment and Bitcoin’s performance, which continues to influence Ethereum’s direction.
If Ethereum fails to hold the $3,750 support, it could extend losses toward $3,600, where deeper liquidity and previous consolidation levels may provide relief.
Institutional and Treasury Confidence Remains High
Despite Ethereum’s short-term weakness, institutional confidence appears resilient. Data from blockchain analytics firm Sentora reveals that ETH treasury holdings saw a net inflow of 550,000 ETH in October, signaling continued faith in the asset’s long-term value.
Although this figure is significantly lower than the 1.5 million ETH net inflows recorded in August, it still reflects positive sentiment among treasury managers and institutional investors. Many view Ethereum as a key infrastructure asset due to its growing role in DeFi (Decentralized Finance), staking, and real-world asset tokenization.
Ethereum’s month-long decline of 13.34%, as reported by CoinMarketCap, has not deterred long-term holders. Instead, many investors have used the correction to accumulate more ETH, betting on future upgrades and broader adoption of Ethereum 2.0 and Layer-2 scaling solutions.
Outlook: Consolidation Before the Next Move
At present, Ethereum’s consolidation phase reflects a balance between cautious optimism and lingering uncertainty. Analysts argue that the upcoming week could be pivotal, with traders eyeing a possible breakout above $4,000 or a retest of $3,750.
If the broader crypto market stabilizes and Bitcoin maintains support above $107,000, Ethereum could find the momentum to retest resistance levels and potentially break free from its current range.
Until then, ETH remains range-bound, with liquidity clusters shaping short-term movements. A decisive move outside the $3,750–$4,200 range will likely determine Ethereum’s next major trend direction.
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