​​Ether Price Update: ETH Faces Resistance Despite Supply Tightening And Network Upgrades​

(MENAFN- DailyFX (IG)) Ether remains under pressure

​Over the past month, Ether (ETH) has remained a focal point in cryptocurrency markets as both price action and on-chain metrics reflect a blend of consolidation, structural supply tightening, and evolving macro sentiment.

​In mid-December, Ether hovered near key support levels around $2,800.00 after volatility earlier in the month, illustrating a cautious but not broken recovery following a period of weakening prices and broader market risk-off behaviour.

​According to recent market analysis, ETH's stabilisation in this range has coincided with shifting expectations around interest rate policy and renewed inflows from institutional buying, providing a degree of resilience even as the broader crypto sector navigates uncertainty.

​One of the most notable developments in the Ether market is the ongoing contraction of its liquid supply. At the beginning of the month data indicated that exchange balances of ETH have fallen to near historic lows - around 8.7 % of total supply, the tightest environment seen in Ethereum's history.

Tokens are increasingly moving into staking protocols, layer-2 networks, and institutional custody solutions, reducing the quantity available for trading and selling and suggesting that longer-term holders are backing their conviction with actual supply withdrawal from markets. This structural dynamic has been interpreted by analysts as a bullish underpinning for ETH's medium-term outlook, even if price gains have yet to be sustained.

​Institutional behaviour around Ether has also been mixed but noteworthy. While some Ether spot exchange-traded funds (ETFs) saw net outflows of roughly $19.4 million over the early December reporting period - with one major trust driving the collective decline - other products such as BlackRock's ETH ETF recorded net inflows in the same timeframe.

​This split highlights that institutional participation remains active but discerning as investors balance risk and opportunity around the $3,000.00 zone. These dynamics reflect the broader theme of institutional involvement helping to shape near-term price trends for ETH.

​On the development front, Ethereum's long-anticipated Fusaka Upgrade - activated earlier in the month - introduced PeerDAS, a protocol enhancement that doubled layer-2 data capacity and significantly reduced transaction fees for rollups. This upgrade reinforces Ethereum's reputation for continued innovation and long-term scalability while making it more cost-efficient for decentralised applications (dApps) and layer-2 activity. Improvements of this nature deepen the utility narrative for Ethereum, even as price trends take direction from broader macroeconomic forces and capital flows.

​Despite these positives, Ether's price continues to confront resistance and investor caution. Market sentiment has been influenced by mixed macroeconomic signals, with cryptocurrencies often mirroring risk-off behaviour seen in equities and other risk assets following recent US inflation data.

​Ether has shown some positive reaction to market sentiment shifts - for example, modest price gains following inflation reports - but analysts remain wary that macro dynamics could temper upside unless clearer, more sustained signals emerge. As with Bitcoin and other digital assets, Ether's movement is intricately linked to broader financial conditions.

​Taken together, the past month illustrates that Ethereum's story is not merely about short-term price action. A tightening supply environment, institutional participation, and significant network upgrades form a complex backdrop against which investors and traders are shaping their views.

​While volatility remains a defining feature and macro pressures persist, these fundamental and structural developments suggest that Ethereum continues to attract interest beyond pure speculation.

​Whether these forces ultimately translate into a sustained recovery or eventual breakout will depend on how macroeconomic sentiment, institutional allocations, and on-chain behaviour evolve in the weeks ahead.

​​Ether bearish case:

​Ether is seen coming off Monday's $3,075.34 high whilst aiming for the 7 December low at $2,925.33.

​A fall through the Sunday 7 December low at $2,925.33 would probably put the bears back in control with the $2,800.00 region perhaps being revisited.

​Ether bullish case:

​Ether needs to overcome Monday's $3,075.34 high for it to reach the 55-day simple moving average (SMA) and downtrend channel resistance line at $3,160.30-to-$3,173.30. This resistance area and the 15 December peak at $3,176.83 need to be exceeded for the 10 December high at $3,447.01 to be back on the cards.

​​Short-term outlook:

Bearish while below the 22 December high at $3,075.34.

​​Medium-term outlook:

Neutral while above the November low at $2,622.43 but below the $3,447.01 current December peak.

Ether daily candlestick chart Source: TradingView Important to know

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