Ethereum exchange-traded funds (ETFs) have witnessed a significant turnaround, with inflows totaling $312 million this week, reversing a persistent trend of outflows that lasted nearly a month. This remarkable shift marks the strongest weekly performance for Ethereum ETFs in November, as reported by CoinMarketCap.
From November 1 to November 20, Ethereum ETFs experienced continuous outflows, with net flow figures remaining in the red for an extended period. The data indicated that several days saw outflows dip below the $120 million threshold, as investors hesitated while ETH struggled to maintain stability above the $3,000 mark.
However, the narrative changed dramatically starting November 23. Daily inflows began to show positive momentum, shifting the trend from deep red to a steady blue. This week alone, inflows ranged from modest investments to significant purchases exceeding $100 million, culminating in the impressive $312 million figure by November 27. This represents the largest weekly turnaround since the inception of ETF trading for Ethereum.
Several factors appear to be driving this sudden influx of capital into Ethereum ETFs. First, there is a noticeable uptick in investor risk appetite as participants position themselves ahead of critical macroeconomic events expected in December, including U.S. inflation reports and predictions of interest rate cuts in Q1. Additionally, Ethereum has demonstrated resilience around the $2,900 to $3,000 price range, encouraging institutional investors to re-enter the market.
Another contributing factor is the recent market structure of ETFs. After a sustained period of selling, many funds had reached an oversold condition, heightening the chances of a rebound in inflows. Furthermore, anticipation surrounding upcoming upgrades to the Ethereum network, including increased staking demand and essential milestones in the roadmap, continues to shape long-term ETF strategies.
Despite the surge in inflows, it is worth noting that the price of Ethereum has yet to fully respond to this influx. Historical data suggests that ETF flows often lead price movements rather than react to them. If the inflow trend persists into early December, a sustained price movement above the $3,050 to $3,150 range could become more probable.
The recent inflow patterns indicate a potential local bottom for Ethereum, particularly following a prolonged period of negative sentiment throughout November. The crucial question remains: will this positive trend continue into the coming week? If so, Ethereum may enter December with renewed momentum and a stronger market foundation than it had earlier in the month.
