Ethereum at a Pivotal Crossroads: Is $3,500 a Sustainable Floor or a False Dawn?

Ethereum (ETH) finds itself at a critical juncture as it tests the $3,500 psychological level amid a tug-of-war between bearish on-chain selling pressure and emerging technical resilience. The past month has revealed a complex narrative: while long-term holders have aggressively offloaded ETH, buyers have begun to cluster around key support zones, creating a potential battleground for the asset's near-term trajectory. This analysis synthesizes on-chain data and Fibonacci-driven technical indicators to assess whether $3,500 represents a durable floor or a fleeting reprieve.

On-Chain Dynamics: A Bearish Undercurrent

November 2025 has been a month of heightened selling pressure from Ethereum's long-term holders. On-chain metrics reveal a 191% spike in hodler net position change on November 28, with over 973,000 ETH sold-a stark contrast to the 309,000 ETH sold just six days earlier according to analysis. This exodus coincided with a 23% monthly price decline and a weakening RSI, which formed a hidden bearish divergence as data shows. Meanwhile, blockchain revenues plummeted to $26.6 million in November, a 37% drop from October, underscoring broader ecosystem stress according to Vaneck's monthly recap.

Yet, amid this bearish backdrop, accumulation at key support levels suggests buyers are not entirely absent. Over 2.8 million ETH has been scooped at $3,150, and more than 3.6 million ETH at $2,800, forming robust demand walls. These zones, combined with the "infinite demand loop"-driven by ETF inflows, staking activity, and gas burn-could structurally reduce ETH's liquid supply and stabilize the price according to MEXC's analysis.

Technical Analysis: Fibonacci Levels and Divergence Signals

Ethereum's price action in November has been tightly correlated with Fibonacci retracement levels. The $3,060 level, once a support, now acts as resistance after being breached as reported. Current consolidation around $3,195-a 0.618 Fibonacci level-has become a focal point. A rebound above this level could target $3,341 and $3,515, while a breakdown risks a retest of $3,000 according to price prediction analysis.

Crucially, hidden bullish divergence has emerged on shorter timeframes. On the daily RSI chart, Ethereum has formed higher lows in price while the RSI records lower lows-a classic sign of waning bearish momentum as data shows. This divergence, coupled with an ascending triangle pattern (characterized by higher lows along an upward-sloping support line), suggests buyers may regain control if the price holds above $3,175 as technical analysis indicates.

However, the path to $3,500 is fraught with challenges. The $3,350 resistance zone-a confluence of the 50 EMA, 100 EMA, and 0.786 Fibonacci level-has already rejected ETH twice according to price prediction analysis. Institutional outflows from Ethereum ETFs, particularly on November 19, further complicate the outlook, as they signal ongoing bearish sentiment according to crypto analysis.

Conflicting Signals: A Cautionary Outlook

The data paints a mixed picture. On one hand, hodler selling pressure and ETF outflows indicate a fragile market structure. On the other, on-chain accumulation and technical divergence hint at a potential reversal. The key question is whether the $3,195–$3,260 zone can hold as a catalyst for a rebound.

If Ethereum fails to defend this area, the next bearish target is $3,084, with a psychological floor at $3,000 according to price prediction analysis. Conversely, a breakout above $3,350 could reignite bullish momentum toward $3,500 and beyond, provided ETF inflows resume and on-chain selling abates.

Strategic Positioning for Investors

Given the conflicting signals, investors should adopt a cautious approach. Short-term traders might consider entering long positions if Ethereum reclaims $3,240–$3,260 with a confirmed close above $3,350 according to price prediction analysis. However, the risk of a breakdown below $3,175 remains, warranting tight stop-loss orders.

For longer-term holders, the $3,150 and $2,800 support walls offer compelling entry points, assuming the infinite demand loop continues. Meanwhile, hedging strategies-such as shorting volatility or using options-could mitigate downside risk in a volatile environment.

Conclusion

Ethereum's $3,500 level is neither a guaranteed floor nor a definitive false dawn. Instead, it represents a critical inflection point where technical and on-chain forces will clash. While the bearish fundamentals persist, the emergence of bullish divergence and accumulation zones suggests a potential floor is forming. Investors must remain vigilant, monitoring both hodler behavior and institutional flows to navigate this pivotal crossroads.