Ethereum (ETH) price extended its losses, dropping 3.75% to near $2,112 as a confluence of macroeconomic headwinds battered risk assets. Analysts point to rising U.S. Treasury yields, record oil prices driven by geopolitical tensions, and accelerating outflows from spot Ethereum ETFs as key factors undermining any bullish momentum.
Markus Thielen, CEO of 10x Research, highlighted the strong correlation between ETH price and the 30-day moving average of daily net inflows into spot ETFs over the past 12 months. He noted that institutional capital remains a critical variable for Ethereum. However, with 10-year Treasury yields surpassing 4.6% amid stubborn inflation, the roughly 2.5% staking yield on Ethereum has become far less attractive, slowing staking demand. Thielen warned that spot Ethereum ETFs returned to net outflows in May, and if this trend persists, "Ethereum’s price will likely remain in a consolidation range" without a clear direction.
A separate wave of selling was triggered when President Donald Trump warned of possible U.S. strikes on Iran, sending Brent crude oil to $111.15 per barrel. Across the crypto market, more than $657.9 million in positions were liquidated, with Ethereum alone accounting for $256.83 million in wiped-out long positions. Spot Ethereum ETFs saw about $255 million in weekly outflows, and a $11.58 million exploit on the Verus-Ethereum Bridge added to negative sentiment.
Macro analyst Crypto Patel and Bitmine founder Tom Lee emphasized the strong inverse correlation between crypto and crude oil, which has reached its highest level in nearly a decade. Rising oil prices fuel inflation fears, pressuring the Federal Reserve to keep interest rates higher for longer, which drives investors away from speculative assets like Ethereum. "If oil settles down, it might be the first real sign of relief for Ethereum," the analysis noted, with many traders now watching energy markets as closely as crypto charts.
Technicals show ETH breaking below the $2,350 resistance and approaching the crucial $2,100 support. The 4-hour RSI dropped to 29, deep in oversold territory, while the Ultimate Oscillator remained below the neutral line, signaling strong bearish momentum. A loss of $2,100 could push prices toward $2,000, while a recovery above $2,250 is needed to challenge the $2,350 wall.
