Ethereum News Today: Ethereum Falls Below $3,500 Amid Sharp Taker Sell Volume and Bearish On-Chain Flow

Ethereum’s price has dropped below $3,500 as of August 2, 2025, marking a significant decline amid heightened bearish sentiment and strong net outflows across major exchanges. The drop reflects a broad market fatigue, with on-chain data showing a sharp spike in taker sell volume reaching $335 million within two minutes on July 29, 2025. This activity marked a breakdown below the $3,860 resistance level, pushing the price to $3,619 and sparking concerns about further downside risks [1].

Technical indicators support the bearish narrative, with Ethereum currently hovering just above the 100-period simple moving average (SMA). The asset has corrected nearly 8% from recent highs, failing to maintain strength above $3,850. On-chain analyst Maartunn notes that the large taker sell orders suggest a combination of profit-taking by institutional players and panic-driven selling from retail traders following a recent rally [1]. The market’s inability to reclaim the $3,760–$3,800 resistance zone increases the likelihood of a deeper correction toward $3,400–$3,500, and in more extreme scenarios, even $3,175 or $2,852 [1].

Despite the short-term bearish pressure, Ethereum’s long-term fundamentals remain intact. Continued growth in decentralized finance (DeFi) and the adoption of Layer 2 solutions provide a strong narrative for the asset. Large investors are reportedly using the current weakness to accumulate ETH at lower levels, indicating belief in its long-term potential as a leading platform for DeFi and real-world asset (RWA) tokenization [1].

The broader cryptocurrency market is also under pressure, with Bitcoin and altcoins facing key support levels. The lack of public commentary from Ethereum core developers, including Vitalik Buterin and Joseph Lubin, suggests the decline is primarily driven by market dynamics rather than external catalysts like policy changes or major project announcements [1]. Analysts such as Michaël van de Poppe highlight the bearish bias from on-chain net flows, noting a $113.19 million outflow on August 1, further reinforcing the bearish trend [1].

Historical parallels to similar market conditions in Q3 2024 suggest that short-term liquidations can lead to stabilization at key support levels. If Ethereum can hold above the 200-period SMA, it may provide a temporary floor for further consolidation. However, without a strong reversal above $3,860 in the coming days, the bearish momentum is likely to continue, increasing the risk of further downward movement [1].

The next few days will be critical in determining whether the current correction is a healthy consolidation or the start of a more prolonged bearish phase. A successful rebound above $3,860 could pave the way for a recovery toward $4,000, while failure to regain that level would likely confirm the ongoing bearish trend [1].

Sources:

[1] Ethereum Taker Sell Volume Hits $335M In Just 2 Minutes: Panic Or Profit-Taking?

https://www.newsbtc.com/news/ethereum/ethereum-taker-sell-volume-hits-335m-in-just-2-minutes-panic-or-profit-taking/