Ethereum is currently attempting to stabilize above the $3,100 level after an unsuccessful attempt to breach the $3,400 resistance. The broader cryptocurrency market is facing difficulties in regaining momentum, with Ethereum experiencing a fragile price action that remains highly reactive. Sellers continue to emerge during price rallies, making the market environment precarious.
Recent analysis from Arab Chain indicates that Ethereum is in a sensitive phase as it approaches the start of 2026. The report highlights that ETH is trading close to the $3,200 mark while market flow conditions lean towards the downside. The Accumulated Order Flow (CVD) indicator reveals a reading of approximately -3,676, indicating that net selling pressure is prevailing over short-term activity. This translates to a scenario where aggressive sell orders are outpacing buy orders, despite attempts to maintain current price levels.
This divergence between price stabilization and negative order flow implies that while the market is not collapsing, it is also failing to attract significant demand. As Ethereum defends its support levels, the critical next challenge will be whether buyers can reclaim the $3,300 level and test the $3,400 resistance again, or if ongoing weakness will pull the price back towards deeper support zones.
Despite the negative CVD, Arab Chain points out that the correlation between Ethereum“s price and liquidity flows remains intact. The 30-day correlation stands at approximately 0.62, suggesting a constructive relationship between price action and volume behavior, even though the current liquidity is skewed towards selling.
From a broader perspective, the gradual decline in Ethereum prices signals a correction phase following a significant upward movement. Historically, such environments prompt short-term investors to take profits and reduce exposure, while larger market players begin to rebalance their portfolios and cautiously rebuild their positions. Instead of witnessing an immediate trend reversal, the market often transitions into a period of sideways price action as both buyers and sellers test liquidity.
A notable aspect is that the negative CVD illustrates that demand has yet to strengthen sufficiently to alter the short-term flow structure. Nevertheless, Ethereum“s ability to maintain levels above $3,000 indicates some underlying support that is curbing downside acceleration. This combination of weak momentum in volume flows, paired with stable price behavior, frequently precedes consolidation phases that can lay the groundwork for a more robust upward movement once liquidity conditions improve.
As of now, Ethereum is trading around $3,111, still attempting to recover from the broader downtrend initiated after the November breakdown. The $3,300 to $3,400 region remains a critical resistance area, with price repeatedly failing to maintain momentum in this zone. The latest rejection serves to reinforce its status as a major distribution level. On the other hand, Ethereum is managing to stay above its short-term moving average situated near the $3,050 to $3,100 range, indicating that buyers are still active and working to defend the current price levels.
However, with Ethereum remaining capped below mid-term moving averages that are trending downward, the market continues in a setup characterized as a “recovery inside a downtrend.” This situation will persist unless bulls can successfully convert these resistance levels into support. Additionally, trading volume has remained relatively subdued during this recovery, implying that the current move is lacking the aggressive follow-through necessary for a significant breakout.
In conclusion, Ethereum appears to be in a state of consolidation, with $3,000 designated as the critical support floor and $3,400 as the required breakout trigger to shift prevailing market sentiment.
