Ethereum Overbought at $3,650: ETF Inflows and Whale Buys Hint Pullback
Ethereum has surged 46.6% in Q3, trading near $3,650 after BlackRock filed a combined spot-and-staking ETF that helped U.S. ETH ETF assets jump 40% month-on-month to $14.87 billion. The July 18 GENIUS Act’s 100% reserve rule for stablecoins further boosted on-chain confidence. Technically, Ethereum broke above $3,500 with a daily RSI near 95 and a MACD histogram at +86.8, staying 9% above its 7-day EMA.
Despite strong momentum, over 95% of ETH supply is in profit—a level historically linked to distribution and sharp corrections. Bitcoin dominance RSI has dipped into oversold territory near the 60% support zone, raising the risk that a BTC.D rebound could redirect capital back to Bitcoin. High whale activity, including 58,268 ETH bought at an average $3,680, underscores smart-money positioning ahead of a potential pullback before Ethereum targets $4,000.
Bearish
Ethereum’s sharp rally to near $3,650 and overbought RSI readings signal heightened distribution risk. Institutional flows from BlackRock’s spot-and-staking ETF and stablecoin reserve rules have driven a technical breakout, but with more than 95% of supply in profit, historical patterns point to potential profit-taking. An oversold Bitcoin dominance RSI near its key support suggests a possible capital rotation back to BTC. Combined with heavy whale positioning ahead of a $4,000 target, these factors heighten the odds of a short-term pullback despite longer-term bullish catalysts.