Ethereum Price Drops Amid ETF Outflows and Risk-Off Sentiment

Ethereum's recent price drop is a result of a complex interplay of market forces. One key factor contributing to this decline is the ongoing trend of ETF outflows. Over the past 16-17 sessions, US spot Ethereum ETFs have experienced net outflows, with the last net inflow occurring on May 8. This has left total ETF assets at around $9.96 billion. Furthermore, long-term holder demand has weakened, with Glassnode's hodler net position change metric collapsing by approximately 80% from June 1 to June 3.

Additionally, the funding rates for ETH perpetual futures on Binance have spiked to around 0.00087, indicating a crowded long side. As the price slid, about $368.63 million of Ethereum long positions were liquidated over 24 hours, part of a roughly $1.61 billion wipeout across crypto markets.

The technical breakdown through key support levels has also played a significant role in ETH's decline. The cryptocurrency had already fallen below $2,000 and $1,800, turning these levels into resistance. ETH is now trading below its 20-, 50-, 100-, and 200-day moving averages, a classic bearish configuration.

The broader crypto and macro environment has been turning risk-off, amplifying ETH-specific pressures. Total crypto market cap is down around 4% over the last 24 hours and roughly 19% over 30 days. Macro conditions, including rising crude oil prices and renewed inflation worries, reduce appetite for risk assets.