Ethereum update: institutional momentum builds as ETH faces market volatility

​​​Ethereum update

​Ethereum’s trajectory remains under close watch this week, as the market absorbs fresh developments that could reshape demand for Ether (ETH).

​One of the more notable stories is Morgan Stanley’s decision to expand into crypto trading on its E*Trade platform in partnership with Zerohash, which will include Ether alongside Bitcoin and Solana.

​This step illustrates how major financial institutions are increasingly treating ETH as a core digital asset in their offerings.

Recent market fluctuations and institutional interest

​Meanwhile, the market recently endured a broad crypto sell-off that also knocked on Ethereum’s door. The downturn, triggered by a massive $1.7 billion liquidation event across futures exchanges, swept through leveraged positions with ETH absorbing around 30% of the pressure.

​Ethereum pulled back alongside Bitcoin and other major tokens, reflecting how sentiment remains fragile when leverage is stretched and macro uncertainty looms.

​The current bout of weakness, however, should not obscure deeper positive undercurrents in the Ether market.

Notably, whale accumulation is evident: in the past week alone, large holders added approximately $1.73 billion worth of Ether to their balances, signalling conviction from long-term players even as short-term traders unwind.

At the same time, inflows into Ethereum as an institutional asset are gaining momentum, helped by smoother regulatory paths for cryptocurrency exchange-traded funds (ETFs) in the United States (US) and rising interest in tokenised asset vehicles.​

​All this places Ether in a delicate balancing act. If markets stabilise, Ether could regain momentum as institutional flows and usage narratives strengthen. However, if macroeconomic shocks or regulatory headwinds emerge, further downside cannot be ruled out given the crowded nature of some positions.

​​Ether bullish case:

Ether continues its gradual ascent from last week's $3826.75 low but seems to be struggling around the early September lows in the $4250 region.

If it overcomes this hurdle, the September resistance line at $4352 would be next, followed by the 55-day simple moving average (SMA) at $4399.77.

​Ether bearish case:

​If Ether falls through its mid-August and 22 September lows at $4063.65 to $4082.96 and closes below this area on a daily chart basis, last week's low at $3826.75 may be revisited.

Only a major bearish reversal falling through the next lower early August low at $3356.65 would increase the odds of a medium-term top forming.

In this scenario, the area between the February to June highs at $2879.45 to $2733.27 may be targeted.

Ether daily candlestick chart